Saturday, 21 April 2018

This Tory UK Government ... The Bonus Con

I've just found some definitions for the word bonus such as: 'a sum of money added to a person's wages as a reward for good performance' and 'something extra beyond a stipulated payment'.  In every one they either clearly state or infer that a person needs to have done more than what would normally be expected in doing that particular task or job.

Whilst I still think CEOs of some companies are overpaid, I can concede that their role, together with the important decisions they have to make, is pivotal to the success of the company, and as such warrants a high salary. 

But, and it's a BIG BUT, surely to earn that pay they should perform at least sufficiently well to ensure the continued viability of the business, and so b) only get a bonus for going that bit extra - higher productivity, a more satisfied workforce etc.  Sadly some companies have other ideas ... 

Somehow Persimmon Homes managed to get through a bonus scheme linked to share values, such that in 2017 CEO Jeff Fairburn received a total of over £47million - a basic salary of £675,270, a bonus of £1.3 million, and the rest a share award of over £44m.  This year the total package was going to be over £100m until a share-holder backlash reduced it to £74m!

Forget the obscene shares payout (how DID that get agreed?!) but I ask you how can a company in any way, shape or form justify paying a bonus that is more than the salary, indeed DOUBLE???!!!

This is eye-wateringly beyond belief and totally unwarranted. 

And as for Carillion, there the CEOs still got bonuses even though the company was actually failing.  I wonder where they found the definition of 'bonus' for that?!

In August the media lauded Theresa May when she attacked firms who hand bosses excessive pay "as the unacceptable face of capitalism", and the Tories had promised in their manifesto that executive pay should be approved by an annual vote of shareholders.  But since then it has been much more quietly made known that they've watered these proposals down - oh what a surprise!


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