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theHRDIRECTOR Issue 65
This issue we speak to
Richard Boon
Head of HR, England 2018

FEATURES

Special Report
Pensions
Reward
Lean working
HR Software

FEATURING

Skanska
Somerfield
Bourton Group
CIPD
Accenture

Pay and Reward

British Workers skim a billion off the top via fraudulent expenses claims
MPs might be in hot water over their elaborate expenses at the moment but new research has revealed they aren't the only ones living the high life on other people's money. Cheeky British workers are swindling their bosses by over a £1 billion a year on spurious expense claims including plastic surgery, a new car, a diamond engagement ring, escorts, council tax, a honeymoon, Viagra and even a goat.
One in six employees wouldn't ask for a pay rise
New research from Ceridian has revealed that a staggering one in six employees said they would never dream of asking for a pay rise. Age is definite factor in this it seems, with older respondents more prepared to take the bull by the horns. Just 19% of under 34s feel comfortable asking for a pay rise while 81% of over 35s feel confident asking for extra money.
Medical inflation reaches 10% as claims increase
Company medical plans may have to undergo similar changes experienced by company pension schemes if medical inflation continues at its current rate, says Mercer. According to proprietary data analysed by the company, medical inflation is currently running at 10% a year. If this rate of inflation continues, a medical plan costing an employer £1 million in 2008 will, measured by compound inflation, cost around 60% more in five years’ time.
Sexism and the City!
Differences in pay between men and women are still alive and well in the City with wealthy women earning an average of 37% less than their high earning male counterparts. These new figures from The Route City wealth club (The Route) show that men earn significantly higher average salaries (£445,000) than women (£281,000).
Two thirds of the British workforce feel underpaid
Around two thirds (65%) of the British workforce believe that they are not paid enough for the work they do, according to new research from Unum, the UK’s leading disability insurer. By contrast, only two per cent of people think that they are overpaid by their employer. On average, British workers feel that they are underpaid by £5,250 per year. However, more than a million people believe they should be earning between £10,001 and £20,000 more a year and up to 129,000 workers (1%) think that they are underpaid by more than £30,000 a year.
German Executives net 23% bigger salary increase than FTSE 100 counterparts
Pay for executives of the 100 biggest German companies grew 23% faster than their FTSE 100 counterparts in 2007, reveals research by Incomes Data Services (IDS). DAX 100 executives netted an average 10.5% salary increase last year, compared to just 8.1% for FTSE 100 executives. The average salary for DAX 100 lead executives in 2007 was £505,997 per annum, against £737,537 per annum for the FTSE 100.
Senior Executives pay growth goes into reverse
Pay growth for directors and senior executives has gone into reverse in the past year and has fallen to below the cost of living, as wage pressures start to bite following the credit crunch, reveals research by Incomes Data Services (IDS).
US Director compensation remains unaffected by economic slowdown
In the face of a slowing US economy and weakening corporate performance, corporate director pay has continued to increase, according to a US study released by Mercer today and based upon recent proxy filings. The turbulent economy has apparently had little impact on director pay.
British Executives earn lowest real pay rate in Western Europe
Senior managers in UK firms have among the lowest levels of disposable income in the world, according to a new study by global management consultancy Hay Group. “The World Pay Report 2008” places UK executives just 47th in the real pay stakes out of 51 economies analysed. The study also reveals a downward trend for management purchasing power in Britain, with this year’s ranking significantly worse than last year’ position (40th of 47).
"Compensation culture" in the UK grossly exaggerated
New research from personal injury solicitors Hubbard Pegman & Whitney (HPW) reveals that the majority of people have modest expectations for compensation following injuries at work, casting doubt on the widely-made claim that Britain has developed a compensation culture.
No escape for interims in recession
Although the average daily rate for an interim has risen by 1.5 percent, from £603 to £612 a day, interims operating in the financial sector have experienced a drop in average daily rate of four percent.
Female financial pay unfair, says Minister
Despite women making up 49 percent of the workforce of the financial sector, they earn on average 40 percent less than men, making them the victims of the biggest gender pay gap on the UK. Nationally the gender pay gap stands at 22.6 percent.
Interim pay soars
The 'War for talent' is pushing up pay for interim managers working in banks by 50 percent. Rates are up to £1,500 a day, reflecting the growing power of "middle office" over trading and sales.
HR and Finance professionals don't want payroll responsibility
Companies could be doing more to ensure their payroll function is running efficiently, according to research by ADP Employer Services. The payroll service provider surveyed over 750 HR and finance professionals in charge of payroll and found that fewer than half of them have any efficiency measures in place. Surprisingly, finance professionals actually faired worse with only 39% measuring efficiency compared to 49% in the HR department.
Four UK Employers win first Annual AARP International Employers Awards
It is the first time that TAEN has linked up with AARP, the US-based non-profit organisation representing 40 million members aged 50 and over. The new award, designed to promote best practices from employers around the world, recognises ten winners – four of whom are from the United Kingdom:
Commission pay errors cost companies over £5m a year
Almost a quarter of companies surveyed by market research specialist Vanson Bourne said they regularly saw errors of over 10% of the total commission paid – with over a quarter spending over £50m on commission annually. Another 20% said they didn’t know what errors occurred when paying out sales commissions. The survey was carried out on behalf of OpenSymmetry, an independent consultancy firm that offers highly specialised services focused on delivering Sales Performance Management (SPM) solutions to clients worldwide.
Reader Offer
If you are involved in Employee Rewards and Benefits you have an opportunity to network with thousands of other professional peers at Employee Benefits Live.
Removal of tax breaks undermines childcare voucher schemes
Four in five payroll professionals do not think organisations will continue running childcare voucher schemes after tax exemptions are abolished, according to research by the Institute of Payroll Professionals (IPP).
Flexi benefits can cut costs
Employers that use flexible benefit schemes are noticing reduced costs, and engagement is benefitting as a result.
Pay stats “distorted”
Media concern over the rates of public sector pay is ‘a smokescreen’ to distract from the high-level of City bonuses, Unite, the largest union in the country, said today (Thursday, 21 January).
Tax relief plans meet unanimous opposition
Pension professionals have shown unanimous opposition to government plans to restrict tax relief for those earning over £130,000, supported by warnings of further damage to final salary pension schemes, a disincentive to save, unnecessary complexity and inevitable unfairness for some investors.
Employee recognition soars consumer confidence falls
While the Dow Jones Industrial Average and the Consumer Confidence Index have been on a dramatic downward spiral the past few months, an interesting counter-trend has been taking place inside many FORTUNE 500 companies with employee recognition and peer-to-peer awards skyrocketing through the roof.
Boost for public sector as CIPD declares it 'recession-free zone'
Figures published last week by the Office for National Statistics (ONS) highlighted the degree to which public sector pay and employment has remained immune to the impact of the recession.
Strategy to arrest youth unemployment
The National Minimum Wage for younger workers should be frozen in absolute terms in 2010 to ensure welcome government efforts to combat soaring youth unemployment.
Over-what? Paid overtime an alien concept in recession
The Chartered Institute of Personnel and Development (CIPD) claims that employees want to show their commitment to their job by doing overtime - often for no pay and perhaps no recognition.
FSA Guidelines on High Earner Awards
Charles Cotton, Reward Adviser at the Chartered Institute of Personnel and Development (CIPD), welcomes the new guidelines.
New consultation on gender pay gap
The Equality and Human Rights Commission has today launched a consultation on how private and voluntary sector employers* with at least 250 staff can measure and report on their gender pay gap.
Survey reveals shortcomings in closing gender pay gap
With the Office for National Statistics (ONS) due to publish its annual snapshot of the gap between what men and women workers are paid, the CIPD today reports evidence of employer practice and attitudes to measuring the gender pay gap in the workplace.
Senior public sector pay freeze
Pay freeze is a short term measure; long term challenge is to create a coherent, consistent and transparent pay strategy for the public sector.
Banks respond to Government's 'super tax' pledge
Banks are considering their response to Governments one-off payroll tax levy of 50 porecent that will apply to bankers' bonuses over £25,000 and the options available to affected employers.
Boardroom blues as pay is slashed
Boardroom blues as pay is slashedUK business directors are likely to be downbeat in the wake of salary freezes, no bonuses and reduced salary, and the future does not look any brighter.
EU social security legislation impacts on expats
Up to half of all new expatriate assignments within Europe could be impacted by changes to EU social security legislation according to analysis by Deloitte, the business advisory firm.