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Bosses of the UK’s leading companies only have to work until tea time today to earn the same as the average worker earns in the whole year, says the High Pay Centre and the CIPD.
FTSE 100 CEOs only need to work until just before 17.00 on Monday 6 January 2020 in order to make the same amount of money that the typical full-time employee will in the entire year, according to an analysis by the High Pay Centre.
Research for ‘High Pay Day 2020’ by HPC and the Chartered Institute for Personnel and Development shows that top bosses earn 117 times the annual pay of the average worker and that in 2018 the average FTSE 100 CEO earned £3.46 million, equivalent to £901.30 an hour.
In comparison, the average full-time worker took home an annual salary of £29,559 in 2018, equivalent to £14.37 an hour.
The HPC says that, to match average worker pay in 2020, FTSE 100 CEOs starting work on Thursday 2 January 2020 only need to work until just before 17.00 on Monday 6 January – just three working days (33 hours).
2020 will be the first year that publicly listed firms with more than 250 UK employees must disclose the ratio between CEO pay and the pay of their average worker. Under changes to the Companies Act (2006), firms must now provide their CEO pay ratio figures and a supporting narrative to explain the reasons for their executive pay ratios.
The HPC says that, compared with last year, CEOs now have to work slightly longer to make the median UK salary, after their pay fell from £3.9 million. It adds that how major employers distribute pay across different levels of the organisation plays an important role in determining living standards. It is also a key component of the gender pay gap, given women are less likely to fill the top roles.
It states: “CEOs are paid extraordinarily highly compared to the wider workforce, reflecting an approach to business that has made the UK one of the most unequal countries in the developed world.
“If we want to raise incomes for low and middle earners, measures that will enable them to get a fairer, more proportionate share of the spend on pay distributed by big companies will be of critical importance.”