TUC: Pay gap must be tackled

Union leaders today stepped up their campaign to have workers on company remuneration committees, saying the move would help tackle the widening pay gap between top directors and other staff.

The TUC said employee representatives would break the “closed shop” among bosses when top pay is being set, and offer a “healthy dose” of economic reality when earnings and bonuses were being discussed.

The union organisation said action was needed after pointing out that the ratio of executive pay to average employee earnings had more than doubled from 47:1 in 2000 to 102:1 last year.

Pay inequality will get worse unless something is done, the TUC warned, arguing that excessive rewards were “damaging” for business.

Suggestions that share-holders be given greater powers would not make any difference, while worker representation on committees was already widespread in other European countries, said the TUC.

General secretary Brendan Barber said: “With ordinary workers suffering the sharpest fall in living standards in a generation, it’s completely unacceptable for those at the top to continue awarding themselves huge and unjustified pay rewards that bear little correlation to performance.”