Executive Pay rises 41%, worker pay 1%

[scenario8]

I'd like to think the correct opinion is always borne of knowledge and understanding, but with respect, those posts haven't really helped my understanding at all.

[heppers75]

scenario8 said:

I'd like to think the correct opinion is always borne of knowledge and understanding, but with respect, those posts haven't really helped my understanding at all.

I was merely commenting on the fact that when this topic has come up repeatedly over the past year or so (and it has!) it has been plainly apparent that there have been some folks who are so dogmatically aligned to their beliefs they will not accept any debate no matter how reasoned that opposes said dogma.

[scenario8]

Oh, ok. Thanks.

[Randy Winkman]

Halb said:

Randy Winkman said:

Fair point - but they're still people with an opinion, rather than people that either do or don't understand.

Yes. I wasn't disagreeing with you.

[eccles]

heppers75 said:

scenario8 said:

I'd like to think the correct opinion is always borne of knowledge and understanding, but with respect, those posts haven't really helped my understanding at all.

I was merely commenting on the fact that when this topic has come up repeatedly over the past year or so (and it has!) it has been plainly apparent that there have been some folks who are so dogmatically aligned to their beliefs they will not accept any debate no matter how reasoned that opposes said dogma.

True, and it applies equally to both sides of the argument/discussion.

[DJRC]

What about those workers who have left the UK and experienced 100%+ pay rises just because they left the UK to better paid markets?

[PoleDriver]

DJRC said:

What about those workers who have left the UK and experienced 100%+ pay rises just because they left the UK to better paid markets?

The actual pay should not be the driving force here, it's disposable income which counts!
No point in doubling your income if your outgoings increase by the same amount, or more!

[martin84]

Apologies for slightly changing the subject but I think we've done executive pay to death and perhaps we should turn our attention to this 1% rise for the rest of the workforce and ask ourselves why its so low.

There is a theory the tax credit system has resulted in the Government subsidising poor salaries and engineering a system where companies don't really have to pay a half decent 'living wage' as it were because the Government makes up the shortfall. With the staggering amount of tax taken from businesses in the UK the companies probably feel the Government subsidy of tax credits is the least they can do.

Thoughts?

[Murph7355]

martin84 said:

....
Thoughts?

Perhaps the economy's just dog st. Companies can't afford to pay higher wages; more people out of work so more competition for the jobs that are there depressing wages etc.

Can't imagine companies think about government handouts that people might be getting. Wouldn't have thought they think about it that deeply.

[martin84]

Murph7355 said:

Perhaps the economy's just dog st. Companies can't afford to pay higher wages; more people out of work so more competition for the jobs that are there depressing wages etc.

Can't imagine companies think about government handouts that people might be getting. Wouldn't have thought they think about it that deeply.

I'm not talking about just the current situation or the last couple of years. Pay at the bottom has not increased at particularly fast rates over the last 10-15 years, even when times were good. I'd like to see how far above the 1% it was in 2002 for arguments sake.

[eccles]

Murph7355 said:

martin84 said:

....
Thoughts?

Perhaps the economy's just dog st. Companies can't afford to pay higher wages; more people out of work so more competition for the jobs that are there depressing wages etc.

That might work where you are creating the odd single post, but in reality if you need a new worker doing a similar job to existing staff you pay them the same rate.
I'm sure there are quite a few companies that are relatively unaffected by the recession who are just using it as an excuse not to give pay rises.

[DJRC]

PoleDriver said:

DJRC said:

What about those workers who have left the UK and experienced 100%+ pay rises just because they left the UK to better paid markets?

The actual pay should not be the driving force here, it's disposable income which counts!
No point in doubling your income if your outgoings increase by the same amount, or more!

It was more a case of pointing out the double standards at play with regards to "workers". I know a lot of guys who have left the UK over the last cpl of year to work abroad for vastly better money and quality of life. They are still workers, not the "bosses" and the pay rises have all vastly exceeded 41%. Trust me, the disposible income pretty much doubles aswell.

[DJRC]

martin84 said:

Murph7355 said:

Perhaps the economy's just dog st. Companies can't afford to pay higher wages; more people out of work so more competition for the jobs that are there depressing wages etc.

Can't imagine companies think about government handouts that people might be getting. Wouldn't have thought they think about it that deeply.

I'm not talking about just the current situation or the last couple of years. Pay at the bottom has not increased at particularly fast rates over the last 10-15 years, even when times were good. I'd like to see how far above the 1% it was in 2002 for arguments sake.

Pay at the bottom will never increase either fast or by much by simple definition of how the system works. We tried that in the 60s and 70s...it destroyed large swathes of manufacturing in the face global competition.

[ukwill]

DJRC said:

It was more a case of pointing out the double standards at play with regards to "workers". I know a lot of guys who have left the UK over the last cpl of year to work abroad for vastly better money and quality of life. They are still workers, not the "bosses" and the pay rises have all vastly exceeded 41%. Trust me, the disposible income pretty much doubles aswell.

I too have seen this - however only to tax-free countries. And the quality of life argument is open to debate. It tends to follow that those intent on leaving this country to work overseas are also those who besmirch their country of origin's quality of life. Dubai/Saudi may well be hotter and tax free, but better quality of life? That kind of depends very much on your point of view.

[Odie]

Its interesting to see that shareholders are pushing back on boards who are giving themselves 50% ish payrises or 100%+ bonus's.

I don't think this is care for the workers, they want the CEO to run a company like he owns it but see none of the benefit.

I do believe bonus's have a place for CEOs and Board members BUT there needs to be some sense too it.

What percentage of the year on year profit increase is the bonus? Is a good question I think worth asking. As a shareholder that is the type of question I would be asking, along with 'what other bonus's are being given?' I believe that if a company is performing well then every member of staff deserves to be rewarded from the top down. CEO's shouldnt be getting bonus's 'for doing their job'.

[crankedup]

otolith said:

In that particular case, the people whose business it is are complaining about executive pay. That's absolutely fine, it's their interests which are at stake, exactly as it would be if they were complaining about people on the shop floor being paid too much (though I suspect that idea would be greeted differently by some).

'The people who's business it is complaining about executive pay is absolutely fine, its their interests which are at stake'. At long last a PH member sees the light, three bloody cheers. Shareholders are the owners of the Companies currently in the spotlight regarding Corporate salary greed. Well done for recognising the plain facts.

[turbobloke]

At long last? It's been the position all along. Shareholders exercising power is overdue, complain to them whoever they are on a case by case basis, not PH.

[crankedup]

otolith said:

I've never heard this "old school tie" stuff given as reasons for failure, only ever as excuses for not trying. Of course networking is important, but you're more likely to make useful contacts at university than at school, and they are open to anyone of talent.

We, that is PH and myself have had this discussion in the past. 'The old school tie' is an very old term used by many and recognised to mean the back scratching club. A swift Google will reveal all details. I agree that networking is important and part and parcel of business life, 'school tie' is something very different.

[crankedup]

turbobloke said:

At long last? It's been the position all along. Shareholders exercising power is overdue, complain to them whoever they are on a case by case basis, not PH.

Correct Turbobloke, but the long winded discussion last year I had with many PH members who then, for some reason I could never fathom out, was that Dr Vince Cable was quite wrong to propose legislation that would permit the owners of Companies to be given BINDING voting Rights. Look back at the thread about the Barclays Bank shareholders. Of course most of the stuff spouted by other PH members was either ignorance or just being obtuse.

[heppers75]

martin84 said:

Apologies for slightly changing the subject but I think we've done executive pay to death and perhaps we should turn our attention to this 1% rise for the rest of the workforce and ask ourselves why its so low.

There is a theory the tax credit system has resulted in the Government subsidising poor salaries and engineering a system where companies don't really have to pay a half decent 'living wage' as it were because the Government makes up the shortfall. With the staggering amount of tax taken from businesses in the UK the companies probably feel the Government subsidy of tax credits is the least they can do.

Thoughts?

You are spot on with the exec pay discussion....

That is actually in interesting theory... Effectively is the rationale for a company paying a lower wage the knowledge that the difference is made up by the government in the form of tax credits which are themselves subsidised by the tax take from businesses anyway, so in a round about way the business logic is that we are paying them the wage they would otherwise get just in a more spread out and round about fashion.. Interesting thought...

If that is the case like many examples in the current system far more could be achieved by removing daft scenarios like this and simply taking less tax take from businesses to allow them to pay directly to the workers thus removing the government middle man and the cost and bureaucracy which comes along with it!