After a survey showed that over half of workers support a cap on executive pay, the High Pay Centre has called for legislation.
In a poll of 2,000 workers, 55% of respondents agreed that the pay of chief executives should be set at a multiple of low or average wages of employees to ensure that differences between top and bottom earners do not become too large.
The think-tank has also released a Chart for Fair Pay which calls on employers and government to clarify worker rights regarding union participation. It also demands that elected worker directors be given boardroom seats, a task force is established to encourage worker ownership, enhance investor accountability and demand more transparency in corporate reporting.
According to a High Pay Centre survey, 51% of respondents favored voting for two employees on a board. Meanwhile, 70% of respondents supported enhanced pay transparency. In its charter, it suggests that workers have a right to know how they compare with other employees in their organization.
The Centre urges the government to use the draft Bill on Audit Reform, announced in the King’s Speech and the Employment Rights Bill, to “empower employees with a greater bargaining position during pay negotiations and a more significant say in business decisions”.
The Audit Reform Bill proposes sanctions for directors and auditors who do not perform their financial reporting duties.
The Centre reported in August that the pay of chief executives at the FTSE 100 will grow by 2.2% between 2023 and 2025, with the median FTSE 100 executive earning 120 more per year than the average UK full-time employee.
The Charter for Fair Pay claims that “extreme inequality of income is a defining feature of the UK’s economy”, with the UK ranking as the 8th most unequal among 40 major economies in terms of income.
The report states that “most people would be much better off if we distributed income more evenly in our economy, as other European countries do.”
