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Pay ratio between bosses and employees will become an increasingly ‘hot topic'

Tom Castley, VP of Xactly EMEA

"The pay gap between CEOs and their staff is increasingly scrutinised, with LGIM the latest to bring it to forefront of discussion. A rising consensus that executive pay in the UK is too high, with recent research showing that over seven in ten workers believe this to be true. The research also highlighted that six in ten employees find that this high level of executive pay demotivates them."

“Sizeable rewards for chief executives are especially demotivational for workers when there isn’t a bonus scheme in place for those at lower levels of the organisation, as is the case in many businesses in the UK. Every organisation must assess where any pay gaps lie and how they can be addressed. The problem is that the vast majority of businesses are incapable of doing this because they don’t have the data on pay or the skills to analyse it fully. HR will have a list of salaries but lack a fast analysis method to ensure the right people are in the right roles and being paid the right salary.

“It’s time for every employer to take a holistic look at their compensation model to ensure they bridge the pay gaps in their business. Every organisation can benefit from a thorough analysis of its compensation plan. By making a fair and accurate plan, organisations ensure that the workforce is fully enabled to drive the businesses to success. If employees feel that both they and their bosses are being fairly rewarded, then the high pay packet at the top won’t be so depressing. It’s not that companies need to throw money at staff to improve motivation; smart bonus schemes encourage great performances - and productive businesses.”