The pay packets of the U.K.’s top bosses have attracted criticism after a new report revealed the stunning disparity between the average British worker and a typical FTSE 100 CEO.
Labeled “Fat Cat Friday”, January the 4th has been identified as the date by which the average CEO of a blue-chip British firm company collects the same annual take-home pay of a typical full-time worker in the U.K.
The figures collated by the High Pay Centre thinktank and the professional HR body the Chartered Institute of Personnel and Development (CIPD) revealed that last year the average FTSE 100 CEO was paid £1,020 per hour or £3.926 million ($5 million) for the year.
Over calendar 2018, share values of the average FTSE 100 company decreased by more than 12 percent.
The calculations said top UK bosses now earned 133 times more than the average worker and that a CEO who works a 12-hour day would have earned the median £29,574 of British staff by Friday 4th 2019.
A Director of the High Pay Centre, Luke Hildyard, said: “Corporate boards are too willing to spend millions on top executives without any real justification, while the wider workforce is treated as a cost to be minimised.”
The report added that excessive pay and the business culture of “Superstar” CEOs is increasingly being recognised as a failure of corporate governance adding that there was a “myth of super talent” that was used to justify high pay.
Peter Cheese, chief executive of the CIPD, said in a statement Friday the bumper pay packages awarded by remuneration committees represented “a significant failure in corporate governance.”
An umbrella federation of most trade unions in England and Wales, The Trades Union Congress (TUC), took to Twitter to express anger and call for “radical change.”
Despite the outrage, the difference in pay packets is still far smaller than for some firms in the United States. In the U.S., public companies are now required to disclose their companies’ pay ratios between the CEOs and median employees.
For example, in a filing made in September 2018, it was revealed that the Co-CEOs of Oracle, Mark Hurd and Safra Catz, each took home $108 million in the fiscal 2018 year.
Oracle’s median employee pay packet, the point at which there is exactly half of all employees either earning more or less, was $89,887 for the same time period. That works out an at CEO pay ratio of 1,205 to 1.
And in the online study by the American Federation of Labor and Congress of Industrial Organizations, the widest disparity in an S&P 500 company is at the toymaker Mattel where CEO Margaret H. Georgiadis took home $31,275,289 for fiscal 2018. The median worker pay of the firm during the same period was $6,013.