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Boardroom pay gap ‘damaging business performance’

A growing gap between director and employee pay is damaging company performance and by extension the wider UK economy, according to Brendan Barber of the Trades Union Congress (TUC).

The TUC general secretary said the pay divide between the boardroom and the shop floor has created a “them and us” culture within firms that demotivates and reduces productivity.

“As senior execs grab an ever greater slice Britain’s dwindling earnings pool, ordinary workers face having their wages held back, which lowers consumer spending, causes rising household debt and acts as a brake on our economic recovery,” Mr Barber said.

Two-thirds of people feel the gap between the highest and lowest earners in their workplace is too large, according to report by IPPR.

On average, the public think CEOs deserve 65 per cent less than what they actually earn and the low paid deserve more.

“Taking action to close the widening pay gap would not only boost our economy, it would also be a big vote winner, as this poll shows,” Mr Barber said.