Pay matters for normal employees, not CEOs

Good on Barclays and Citigroup, but we need to focus on the pay of all employees, not just those at

Stories about shareholders challenging the size of CEO pay deals have been prominent in this week's business pages. Barclays have hurriedly amended the terms of Bob Diamond's bonus in the hope of avoiding the sort of embarrassment that Citigroup suffered when a majority of their investors rejected Vikram Pandit's remuneration package. 

In recent years, investors have been widely criticised for failing to address excessive executive pay, and while their current spate of activity is welcome there is strong evidence that they alone are incapable of systematically addressing the problem. Also, while investors (and companies, commentators and policy-makers) are now having serious conversations about executive pay, they are neglecting other problems around pay in the private sector – problems which have serious impacts on the company performance as well as on the wider economy and society. 

Articles about the pay of company CEOs are now common in, but there are far fewer stories about the pay of the wider workforce. The disproportionate focus on a tiny minority of employees is not confined to the media. Companies' annual reports are obliged to talk about pay at the top, but there is no such requirement with regard to pay at the bottom or middle. (Vince Cable recently rejected the idea of obliging companies to report on the ratio between CEO pay and that of a typical employee). This being the case, it is hardly surprising that investors engage very seldom with companies about wider workforce pay.

Companies, investors, commentators and policymakers frequently talk about the (probably incorrect) assumption that pay at the top must motivate executives by linking big rewards to company performance. There is far less talk about the correlation between narrow pay dispersion and improved company performance, or the detrimental effect of excessively low pay on the productivity, attendance, retention and mental health of low and middle ranking employees. Ignoring the wider workforce may suppress the performance of the wider company, but too often the pay of anyone outside the higher echelons is seen as a cost rather than an investment.

But investors (and policymakers) should also consider how workforce pay affects the wider economy. The CBI recently claimed that allowing minimum wage to fall behind inflation comes as "a relief" to "many hard-pressed firms", but forgets that many firms are hard-pressed because low-paid workers have little money to spend in the local economy. Excessively low pay also externalises huge costs to the taxpayer, either supplementing wages through benefits (about £6bn a year, according to the IFS) or meeting the social costs associated with in-work poverty.

Some investors have realised that companies have employees beyond the boardroom. Traditionally these have been ethical investors, whose actions may have been motivated more by ethics than investment, but some more mainstream investors (such as Hermes & NAPF) and commentators (such as the share centre) are now beginning to talk about the need to consider top pay in relation to workforce pay.

Beyond a few pioneers, shareholder interest in pay "beyond the boardroom" is pitifully limited. Hopefully investors themselves will take more of an interest in the business case for whole-workforce pay policies, but if their engagement with the issue of excessive executive pay is any thing to go on, that will take a very long time. We need both the media and policymakers to take a lead, by ensuring that the conversations they have with business leaders are not disproportionately about those business leaders.

Our businesses, economy and families need to move away from model that often appears to regard top pay is a matter of motivation and everyone else's pay as a matter of cost. If we do not move away from such a model, the economy will remain unnecessarily sluggish and brutal.

Cutting Bob Diamond's salary may bring the 1 per cent down, but does that help the 99 per cent? Photograph: Getty Images

Duncan Exley is the director of the Equality Trust

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Women's bodies should not be bargaining chips for the Tories and the DUP

Women in Northern Ireland have been told for too long that the Good Friday Agreement is too fragile to withstand debates about their reproductive rights

When Members of Parliament are asked to pass laws relating to when and whether women can terminate their pregnancies, women’s rights are rarely the focus of that decision-making process. You need only look at the way in which these votes are traditionally presented by party leaders and chief whips as “a matter of conscience” - the ultimate get-out for any MP who thinks their own value or belief system should get priority over women’s ability to have control over their bodies.

Today’s vote is no different. The excellent amendment that Labour MP Stella Creasy has put before the house reveals not just the inequalities experienced by women in different parts of the UK when it comes to being able to make decisions about their health, but also the latest layers of subterfuge and politicking around abortion. 

Creasy’s amendment seeks access to the NHS for women who travel to England and Wales from Northern Ireland seeking abortion. Right now women in Northern Ireland are pretty much denied abortion by legislative criteria that limits it to cases that will "preserve the life of the mother" - (that’s preserving, not prioritising) - and pregnancies under nine weeks and four days. Rape, incest or fatal foetal abnormality are not included as grounds for termination. The thousands of women who thus travel to England are refused free abortions on the NHS - confirmed by a recent Supreme Court ruling - on the grounds that this is a devolved matter for Northern Ireland. 

The idea behind devolution is that power should be more evenly and fairly distributed. It is not intended to deprive people of rights but to ensure rights. In refusing to exercise the powers available to him, Health secretary Jeremy Hunt is rightly acknowledging a difficult history of power imbalance between Westminster and Stormont, but he is also ignoring a wider imbalance of power, between men and women.  

There is so very much wrong with this arrangement. But a further wrong could be done if, as reports suggest, the Conservative Party whips its MPs to vote the amendment down in order to protect the regressive alliance with the anti-abortion Democratic Unionist Party (DUP) that is keeping their fragile minority government in power.

Instead of taking this opportunity to respond to the demands of women of Northern Ireland, this government is setting out the parameters of its complicity in refusing to listen to them. 

It is not the first time. In 2008 it was reported that the Labour party struck a deal with the DUP to leave Northern Ireland’s abortion laws intact, in exchange for their support over detaining terror suspects without charge for 42 days. Labour said at the time that it was concerned about the impact on existing UK abortion laws if the debate was opened.

But not one woman has equality until all women have equality. Women’s bodies are not chips to be bargained and we should not be bargaining for one group of women’s rights by surrendering the rights of another group. The UK parliament has responsibility for ensuring human rights in every part of the UK. Those include the rights of Northern Irish women.

It’s time to wake up. It’s time to stop playing politics with women’s lives. Women in Northern Ireland have been told for too long that the Good Friday Agreement is too fragile to withstand debates about their reproductive rights – a fragility that was dismissed by the Conservatives as they drew up a deal with one side of the power-sharing arrangement.

It’s time to confront the fact that nowhere in the United Kingdom – taking Northern Ireland as a starting point rather than an end in itself – do women enjoy free and legal access to abortion. Even the UK’s 1967 act is only a loophole that allows women to seek the approval of two doctors to circumvent an older law criminalising any woman who goes ahead with an abortion.

As long as our rights are subject to the approval of doctors, to technological developments, to decisions made in a parliament where men outnumber women by two to one, to public opinion polls, to peace agreements that prioritise one set of human rights over another – well, then they are not rights at all.

The Women’s Equality Party considers any attempt to curtail women’s reproductive rights an act of violence against them. This week in Northern Ireland we are meeting and listening to women’s organisations, led by our Belfast branch, to agree strategy for the first part of a much wider battle. It is time to write reproductive rights into the laws of every country. We have to be uncompromising in our demands for full rights and access to abortion in every part of the UK; for the choice of every woman to be realised.

Sophie Walker is leader of the Women's Equality Party.

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