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Move to force justification of pay gap between workers and bosses

Businesses and organisations employing more than 250 employees are already under a statutory obligation to publish gender pay gap figures. This has produced disclosures of  some startling gaps in gender pay.  However, equal pay campaigners have been pushing for more stringent reporting obligations and not just relating to a difference in gender.

According to a recent BBC news report, the government is planning to introduce a requirement for directors of all companies with more than 250 employees to disclose and explain the difference in pay between the CEO and an average worker.  This is regardless of gender.  

Whilst this is good news for the equal pay protagonists, the TUC says that even tougher rules are needed. The difficulty lies in recruiting and retaining high performers to produce the kind of results that shareholders expect, whilst at the same time appeasing workers and shareholders when the pay that bosses receive is out of line with the performance of their companies.

The Confederation of British Industry's Matthew Fell said high pay was only ever justified by outstanding performance: "This legislation can help to develop a better dialogue between boards and employees about the goals and aspirations of their business, and how pay is determined to achieve this shared vision."”