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Stuart Gentle Publisher at Onrec

2014 pay bargaining year ends at 2%

The pay bargaining year to the end of August 2014 has ended on a low, according to the latest data from pay analysts XpertHR

The pay bargaining year to the end of August 2014 has ended on a low, according to the latest data from pay analysts XpertHR.

In the 12 months to the end of August 2014, the median pay settlement across the economy was 2%. By sector, this was also the figure recorded for pay awards in the private sector, while the figure for public sector employees was just 1%.

The analysis is based on the details of 980 basic pay settlements covering almost 5.9 million UK employees.

Breaking down the findings:

  • one pay award in 10 was a pay freeze;
  • a fifth were worth 2%;
  • one in seven paid out 2.5%; and
  • a tenth awarded 3%.


Analysis of our sample of pay awards reveals that a significant minority of organisations are still applying non-standard wage settlements. For example, among the sample are organisations that are staging pay awards or making non-consolidated payments to save on the paybill. Others are weighting the award to the lowest paid, either through higher percentage increases for those at the bottom of the pay scale, or by making flat-rate payments that are worth more for the lowest paid.

The past year has seen a number of employers make a commitment to pay the living wage. And with the national minimum wage increasing by 3% next week, the lowest paid employees will be receiving a 3% pay rise from 1 October.

XpertHR Pay and Benefits editor Sheila Attwood said:

"The past year has again seen pay awards at subdued levels, not yet reflecting the pick-up in the economy or the strengthening of the labour market. There are however winners and losers depending on the sector examined."

Latest quarterly data

Figures for the latest rolling quarter continue to show a stable picture of pay awards, says XpertHR. In the three months to the end of August 2014:

  • The median basic pay award was worth 2%.
  • The interquartile range (marking the middle half of all pay awards) stood between 1.5% and 2.5%.
  • Just 7.3% of all pay awards resulted in a pay freeze.
  • Manufacturing-and-production firms continue to lead the way, with pay deals at a median 2.5% compared with 2% in private-sector-services companies.

www.xperthr.co.uk