TUC chief demands “reality” check after British CEO picks up £70m in a year

The head of the TUC has demanded Theresa May take action over “stratospheric” levels of executive pay after new research showed the £70m package awarded to one of Britain’s top businessmen was equivalent to nearly £40,000 an hour.

Frances O’Grady said the prime minister must deliver on her promise to put workers on company boards in order to “inject a much-needed dose of reality” into corporate Britain.

The general secretary spoke out as the Trades Union Congress published new data showing how the pay of top FTSE 100 directors leapt by nearly half since the recession.

The median average total pay (excluding pensions) rose by 47 per cent between 2010 and 2015 to £3.4m. At the same time the average wages of workers increased by just seven per cent and are still “way down” in real terms on pre-crisis levels, the TUC said.

The average earnings of a FTSE 100 boss were 123 times greater than that of the average full-time worker in 2015, up from a multiple of 89 in 2010, the research also showed.

This includes the controversial Sorrell, who is chief executive of WPP, the world’s largest advertising firm. Sorrell, who has presided over enormous growth over three decades at WPP, received a pay package, including salary, bonus and shares, of £70m last year – more than 2,500 times greater than the salary of the average British worker, the TUC said.

Now the workers’ organisation is raising the pressure on May to deliver on her promise to put workers on company boards and remuneration committees.

“While millions of UK families have seen their living standards squeezed, directors’ pay has reached stratospheric levels,” O’Grady said.

“These shocking new figures show why Theresa May must deliver on her promise to put workers on company boards.

“This would inject a much-needed dose of reality into boardrooms and help put the brakes on the multi-million pay packages that have damaged the reputation of corporate Britain.

“Other European countries already require workers on boards, so UK firms have nothing to fear. It improves performance and contributes to companies’ long-term success.”

Former Labour leader Ed Miliband also promised to put workers on FTSE 100 remuneration committees in the run-up to the 2015 general election.

TUC annual congress runs from Sunday 11 to Wednesday 14 September in Brighton. To see the rest of our coverage go to LabourList’s trade unions page.