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Research: Pay Ratios

February 20th, 2014

Pay Ratios

This page provides an at-a-glance summary of sample pay ratios in different sectors in the UK


Private Sector



Public Sector



Voluntary Sector


Pay Ratios

This statistic refers to the average estimated top-to-bottom pay ratio in FTSE 100 companies which disclosed low pay datain response to a request from One Society and the Ecumenical Council for Corporate Responsibility (2011). See our report for details.

“The highest ratio [from a selection of public sector workforces] was in higher educationwhere the median vice-chancellor‟s salary was 15.35 times the bottom of the Universities and Colleges Employers Association pay spine for university staff.” (according to theInterim Report of the Hutton Review of Fair Pay(2010))

“For charities with annual income […] over £50m the [top-to-bottom pay] ratio is 10:1” (according to a survey by Charity Finance magazine (2011) 






How National Minimum Wage is falling behind top pay, and the damage this does to living standards and the economy – a briefing. To download, please click here.

Below is a summary of results from our data analysis (Aug/Sep 2011). This is taken from our report “A third of a percent: The gulf between employees’ pay and chief executives’ pay and the adverse impacts on UK plc.”

Click here to download the full report.


NB: Since our report was published on the 15th September, we have been made aware of some errors in the data provided by our external research partners, relating to the remuneration levels of company directors. At our request, all data relating to directors’ remuneration has now been rechecked and where necessary amended by our research partners, and the data analysis amended by One Society. We apologise for the inaccuracies in the original version of our report. A list of companies whose data has now been amended appears at the foot of this piece.

262:1 average top-to-bottom pay ratio in companies which disclosed data

Of the FTSE 100 companies which disclosed data on their lowest rates of pay in response to our request, estimated top-to-bottom pay ratios varied from 48-1 (Capital Shopping Centres) to 656:1 (Marks and Spencer). The average estimated top-to-bottom pay ratio for this group was 262:1.

An additional comparison of estimated CEO pay and low pay data from collective bargaining records for a sample of 14 FTSE 100 companies produces a ratio of 309:1, this higher figure may be partly explained by the inclusion of some part-time staff and the exclusion of pensions and other benefits from the data.

Ratios of CEO pay to UK employees’ pay

Average estimated FTSE 100 CEO total remuneration was £4.7 million (412 times National Minimum Wage and 221 times 2010 UK median earnings).

Highest estimated FTSE 100 CEO total remuneration was for Reckitt Benckiser’s Bart Becht (£14.4 million: 1262 times National Minimum Wage and 679 times 2010 UK median earnings).

Rises in executive pay outstripped rises in company performance

For FTSE 100 CEOs, there is no statistically significant relationship between pay and company performance over the same period. Across the FTSE 100, rises in estimated executive pay outstripped rises in company value.

We found little to suggest that increased executive remuneration produced increased company performance. In one FTSE 100 company (Carnival), estimated executive pay outstripped company performance by more than 380 percentage points over the same period, whilst in two others (Hargreaves Lansdown and ARM Holdings), company performance outstripped estimated executive pay by over 125 percentage points.

CEO pay as a proportion of company size: large variations

There was wide variation in the level of estimated CEO pay as a proportion of company value, from 0.003% (BP) to 0.425% (Burberry).

Executive pay in the public service industry – much higher than public sector pay

Companies with large public sector contracts typically paid their executives much more than the highest-paid public sector employee. For example Serco, which receives over 90% of its business from the public sector, paid Christopher Hyman an estimated £3,149,950 in 2010. This is 6 times more than the highest-paid UK public servant and 11 times more than the highest-paid UK local authority CEO (approximately 50% of Serco’s public sector business is outside the UK).

In contrast to the suggestion that no-one in a public sector organisation should earn more than 20 times more than their lowest-paid colleague, none of the ‘public service industry’ organisations we examined paid their CEO less than 59 times UK median earnings (estimate).


Estimated average total CEO pay in FTSE 100 banks was £6.4 million; 565 times National Minimum Wage and 304 times 2010 UK median earnings. Standard Chartered had the highest estimated CEO pay (£8.5 million). Estimated CEO pay in (part-taxpayer owned) RBS and Lloyds was £5.9 and £5.8 million respectively.

The high street

Estimated top-to-bottom pay ratios in high street companies which disclosed low pay data are relatively high (an average of 523:1, compared to an average of 306:1 for all companies who disclosed) and range from 349:1 (Kingfisher) to 656:1 (Marks and Spencer). Estimated average total CEO pay in the high street retailers which we examined (which included FTSE 250 companies) was £3.1 million.

Companies for which director’s pay data has been amended

Data relating to most recent financial year for which data was available and to the previous year:
British Land Company; Man Group.

Data relating to previous year (used to calculate year-on year changes only):
Autonomy Corporation; Burberry Group; Halfords Group; Home Retail Group; J Sainsbury; Kingfisher; Lloyds Banking Group; Next; Old Mutual; Royal Bank of Scotland Group; Rolls Royce Holdings; RSA Insurance Group; Standard Chartered.

Other research

New Economics Foundation: The Ratio-Common sense controls for executive pay and revitalising UK business. Describes the UK’s growing pay gap and its adverse effects; proposed that large listed companies should report top-to-bottom pay ratios and adopt a Charter of Responsible Pay (July 4 2011).

High Pay Ratios in the Private Sector: What’s the problem?

(public sector and voluntary sector coming soon)

Private sector pay and the public interest: the costs to taxpayers and the economy

Pay levels in the private sector have impacts which go beyond the company itself. Excessive incentives at the top can produce perverse behaviours. Excessively low pay externalises costs to the taxpayer (e.g. through the benefits system) estimated in the billions of pounds and is likely to reduce the ability of the economy to recover. Excessive gaps between incomes are associated with costly health and social problems as well as with higher levels of debt and economic volatility.

Market failure

There is widespread evidence that the current practices by which executive remuneration is decided in the UK are not working in the best interests of companies and may be suppressing company performance by damaging motivation of both executives and the wider workforce. There is also evidence that the institutional investors who manage the savings of many of the UK population have not as a group been effective in managing this issue.

Pay ratios – as well as just pay levels – are important

Pay ratios are not just a media-friendly way of measuring the growth of executive pay. Executives can find themselves incentivised to suppress employees’ pay below levels that are in the best long-term interest of the company, so adopting pay ratios as a metric would provide a useful counterbalance. Excessive pay dispersion is also associated with suppressed company performance when the workforce as a whole is taken into consideration (as well as the economic costs of pay inequality outlined above).


Excessive pay ratios and levels of executive pay that have grown beyond financial justification are complex matters that do not have a single solution. However, our proposals include:

Mandatory reporting of top-to-bottom (as well as top-to-median) pay ratios, and an expectation that policies on low-paid staff and contractors will be published.

Widening the composition of remuneration committees to include employees (who are more likely to have a longer-term perspective and to require proper justifications for high executive pay).

Widening the agenda of committees (to discourage the idea that executive pay and performance is the only lever in company performance), and reviewing the role of remuneration consultants.

Measures to encourage investor assertiveness, by making investors and companies more transparent and remuneration votes binding.

Use of public sector purchasing power to reduce the costs of contractors’ pay gaps and low-pay practices that are met by the taxpayer.

Research: Low Pay

February 20th, 2014

Recent research and publications on low pay

Shelter: a survey showed that 8 million people in the UK are just one pay cheque away from losing their home. (11th April)

Resolution Foundation showed what wage slowdown looks like under the new ONS inflation measures. (10th April 2013)

UNICEF: Report Card 11, Child well-being in rich countries report shows UK child wellbeing improved by 2010, but remained ‘worrying’. (10th April 2013)

Centre for Economics and Business Research: ASDA Income Tracker found weekly disposable household income up £3 on last year but £4 lower than 2011. (March 2013)

TUC: Analysis of ONS data showed that real wages in the UK are continuing to fall. (March 2013)

Poverty and Social Exclusion: The Impoverished UK showed that over 30million people (almost half the population) are suffering some degree of financial insecurity. (28th March 2013)

Joseph Rowntree Foundation: The Impact of Localising Council Tax Benefit showed 2.4million low-income families will pay on average £138 more in council tax in the new financial year. (28th March 2013)

CPAG: Report shows that Coalition policies will have pushed an extra 600,000 children in to poverty by 2015. (19th March 2013)

TUC: A Bleak Future for Families showed that the majority of UK children will be living below the breadline by 2015. (11th March 2013)

International Labour Organisation: data showed that over the course of 2007-2011 British workers suffered the largest falls in real wages of any G7 economy. The TUC developed this into an infographic. (7th March 2013)

OECD figures showed that British workers have seen sharpest wage fall of any developed economy. (8th March 2013)

ONS: Changes in real earnings in the UK and London, 2002 to 2012 shows average earnings in real terms are now at similar levels to those of 2002-2003. (13thFebruary 2013)

Resolution Foundation: Squeezed Britain 2013 predicts that average wages will not rise in real terms until late 2014 after a period of stagnation and decline. (13thFebruary 2013)

Scottish Widows: Savings and Investment Report finds one in three adults isn’t saving at all. (February 2013)

End Child Poverty: Child Poverty Map of the UK gives figures on the level of child poverty in each constituency, local authority and ward in the UK. (February 2013)

International Labour Organisation: Why have wage shares fallen? investigates the relative impact of financialisation, globalisation, welfare state retrenchment and technological change on functional income distribution. (21st January 2013)

Social Enterprise UK: The Shadow State, A report about outsourcing of public services says a small number of large companies providing outsourced public services are becoming too big to fail, with serious consequences for Britain’s economy and communities.

IFS: The Green Budget 2013 suggested that low real wages may be a contributing factor to reduced productivity. (February 2013)

Department for Business, Innovation and Skills: Workplace Employment Relations Study, reported that the most common changes reported by employees were more work and less pay (25th January 2013)

Aviva: Report shows a squeeze in living standards as the rise in household outgoings outstrips the rise in incomes. (24th January 2013)

IPPR: ‘Beyond the Bottom Line’, report on the Living Wage movement so far. (21st January 2013)

Shelter: Research found that rents were up 3.2% on last year, outstripping wages and leaving a total of £326million in unpaid rent nationwide. (18th January 2013)

ONS: Poverty and Social Exclusion in the UK data showed among its findings that one in three UK households would be unable to meet an “unexpected financial expense”. (16th January 2013)

Shelter: A YouGov survey for Shelter showed that 1.4 million Britons are falling behind with their rent or mortgage. (4th January 2013)

Resolution Foundation: ‘On borrowed time? Dealing with household debt in an era of stagnant incomes’ finds that millions of families are on ‘financial precipice’, which threatens economic recovery. (23rd December 2012)

TUC: ‘Action for Rail’ finds train fares have increased at almost three times the rate of wages since the recession. (13th December 2012)

ONS: Actual Individual Consumption figures show UK standard of living drops to sixth highest in Europe, with consumer prices 3% above EU average. (13thDecember 2012)

Survation: ‘Employment Survey’ shows 71% of employees say their wages have fallen in real terms over the last two years. 83% say Minimum Wage isn’t enough to meet Living Costs. (14th December 2012)

TUC: Where Have All The Wages Gone? Lost pay and profits outside financial services. Rising financial profits have reduced workers’ wages and squeezed profits across the rest of the economy. (7th December)

Demos: ‘Poverty in Perspective’ proposed 20 indicators and a more multi-dimensional approach to measuring and understanding poverty. (29th November)

Office for National Statistics: A recent study showed that one in ten UK workers is ‘under-employed’ – an increase of one million since 2008. (28th November)

Joseph Rowntree Foundation: Analysis shows there are now more people in ‘working poverty’ than ‘out of work poverty’. (28th November)

National Housing Federation: Home Truths 2012.Finds 417,830 more working people, an 86% increase since 2009, are now reliant on housing benefit to help them pay the rising rents on their home. (22nd October 2012)

Queen Mary University of London/ Trust for London: The costs and benefits of the London living wage. Amongst other things, finds staff leaving rates fell by 25% representing a saving of 0.3% of overall costs. (16th October 2012)

ONS: Labour Market Statistics. Shows unemployment is down but increasing number of part-time workers is keeping incomes low. (October 2012)

One Society: We calculated that if the National Minimum Wage had kept pace with FTSE 100 CEO salaries since 1999, it would now be £18.89 per hour. (September 2012)

The Office for National Statistics: New figures show average incomes are the lowest for a decade as employers freeze pay (20th September).

The British Retail Consortium: Research shows that the squeeze on incomes is inflicting “severe and long-lasting” damage on the retail sector (24th September).

Resolution Foudnation: ‘Low Pay Britain‘ report shows one in five British workers – just over five million employees – are now ‘low-paid’ as the national minimum wage falls in real terms for the third consecutive year (28th September).

Save the Children: Child Poverty in 2012 – It shouldn’t happen here. Looks at the experiences of families suffering from a lack of jobs, stagnating wages, increased living costs and spending cuts. (5th September 2012)

Family Action: Breaking the Bank. Shows back to school costs can account for up to 40 per cent of some families’ monthly income in August. (30th August 2012) Affordability Tipping Point. Shows one in five families are struggling to pay bills due to soaring prices and stagnant wages. (23th August 2012)

ONS: The economic position of households, Q1 2012. Real household actual income per head stood at its lowest level since the 2ndquarter of 2005. (31st July 2012)

National Employment Law Project: Big Business, Corporate Profits, and the Minimum Wage. US report showing 66% of low-wage workers were employed by large businesses despite 92% being profitable last year. (19th July 2012)

New Economy: Pay up? Living costs and the living wage in Manchester. Shows that residents of Greater Manchester must earn £7.22 per hour working full-time to enjoy a reasonable quality of life. (July 2012)

Joseph Rowntree Foundation: A Minimum Income Standard for the UK in 2012. Show that families need £37,000 pa to achieve an acceptable standard of living (10th July 2012).

The Children’s Society, Action for Children and NSPCC: A joint report warns of a dramatic rise in disadvantaged children and families. Overall by 2015 vulnerable families will be £3000 worse off each years. (6thJuly 2012).

The Centre for the Modern Family: Family Resilience. Looks at what sustains and nurtures families, finding 1 in 5 families admit “living on the edge” (26thJune 2012).

Irwin Mitchell Employment Group: Recession-Based Employment Tactics. Shows almost half of businesses intend to freeze pay and a fifth cut jobs in the year ahead (25thJune 2012).

Guardian: Survey of online Guardian Teacher Network.Found four out of five teachers (83%) see pupils who are hungry in the morning and 55% said up to a quarter of pupils arrive having not eaten enough (19thJune 2012).

Experian/ Guardian: Research on Working Families. Finds 2.2m children live in households on economic “cliff-edge” and 7 million working-age adults are living in extreme financial stress (18thJune 2012).

Institute for Fiscal Studies: Analysisofpovertystatisticsshow “Biggestone-yearfallinmiddleincomessince1981” (15thJune 2012).

Darren Johnson AM: How long does it take to earn a week’s rent on the minimum or living wage in London?Maps showing how unaffordable average private rents are for low wage workers (June 2012).

ONS Data shows how many people in each EU country live in households with disposable income below 60% of national median, and that 1 in 5 pensioners in the UK are likely to find themselves in poverty. (7th June 2012)

Centre for Economics and Business Research: UK disposable incomes set to fall for a third year running. (4th June 2012)

Resolution Foundation and Joseph Rowntree Foundation Housing in transition: Understanding the dynamics of tenure change warns of steep increases in the number of parents unable to buy homes with a threefold increase in private renting among the under 35 age group on below average incomes. (June 2012)

Resolution Foundation. What price a living wage? Argues there is no business case for pay below Living Wage in banks, construction, computing, food production. The average increase in the wage bill for listed companies in these sectors would be about 1% or less (10th May 2012).

Trust for London. Research project showing changes in dispersion of poverty in London since 2001 (18th April 2012)

Resolution Foundation; “Minimum Wage, Maximum Impact” Finds that the NMW has increased incomes and incentives to work, reduced benefits requirements and not jeopardised employment prospects. Also found insufficient evidence to confidently advocate a much higher overall NMW, but suggested higher rates for certain regions and age groups (17th April 2012)

Guardian: Data analysis showing only 52% of Jobcentre Plus vacancies guarantee enough hours to meet the new government definition of ‘work’, with 24,000 jobs not offering enough hours to qualify for working tax credit, thereby reducing income (8th April 2012).

Family Action: Breaking the Bank : Family Fortunes, The Impact of Austerity on Family Life. Report about families’ experiences of austerity, including the effect of low wages and a call to increase the minimum wage (5th March 2012).

Defra: 31% of British farmers are earning less than the minimum wage, even before taking into account their longer working hours (1st March 2012).

Netmums: Feeling the squeeze. Finds over 70 per cent of families are ‘on the edge’ of surviving with one in five mums is missing meals so her children can eat. (16th February 2012)

CEPR: Low Wage Lessons. Looks at the extent and drivers of low-paid work, finding that 20.6% of the UK workforce was in a low-wage job (in relative terms) compared to an average of 15% in the OECD. (2nd February 2012)

Fair Pay Network: Face the difference: The Impact of Low Pay in National Supermarket Chains. Finds CEOs of the big 4 supermarkets (with combined profits of £5.8bn) get £3-7m each while 86% of employees do not earn Living Wage. (21st January 2012)

Save the Children:Rising Energy Costs: The impact on low-income families. Poll finds almost 1/3 of low-income parents with children under 16 won’t be able to afford their winter energy bills. Research also shows that growing up in cold, damp homes can slow children’s development, worsen long-term problems like asthma, and lead to rises in hospital admission rates (4th January 2012).

Resolution Foundation: Priced Out. Shows that because of a new inflation environment, hard times started significantly earlier for households on lower incomes than for the average UK household (27th December 2011).

Office of National Statistics: The Annual Survey of Hours and Earnings (ASHE) low pay estimates for April 2011. Show there were 299,000 jobs paid below the national minimum wage held by people aged 16 and over (1.2% of of all employee jobs in the UK labour market) (23rd November 2011).

Children’s Society: Missing out, a child centred analysis of material deprivation and subjective well-being. Finds family holidays, pocket money and access to outdoor space are among the things that impact most upon children’s wellbeing (8th November 2011).

Shereen Hussein, Kings College London: Estimating probabilities and numbers of direct care workers paid under the national minimum wage in the UK. Shows that 156,673 to 219,241 care workers in the UK are likely to be paid under the NMW.

The Resolution Foundation: Low Pay Britain.Finds 20% of British employees are earning less than a living wage (2nd October 2011).

Trust for London/ New Policy Institute: Poverty and work. Data shows over half of working-age adults and children in poverty in London are living in a household where someone is in paid work. It also finds that one million people in the city live in low-income working households (20th October 2011).

Resolution Foundation: Poor household finances risk choking off recovery. Shows the impact of inequality on the economy and shows that only 48% of low-to-middle income households have cash left over at the end of each month. (24th August 2011).

Joseph Rowntree Foundation Monitoring poverty and social exclusion in Wales 2011 33% of children in Wales live in poverty; half of the improvements in child poverty rates made in the mid 90s – mid 00s have now been lost (July 7th 2011).

Joseph Rowntree Foundation: A minimum income standard for the UK in 2011. Shows that income necessary for a minimum acceptable standard of living has increased faster than the usual measures of inflation, especially for families with children. (July 5th 2011).

Oyedele, Olufemi. How Managers can Motivate their Employees. 15 out of 20 respondents (75%) in the lower and middle levels of employment supported “regular increment in salary” [as a key motivator] as against 2 out of 10 respondents in the higher cadre. (18th May 2011)

What is one society?

February 20th, 2014
“Westminster Bridge” by Patrick Wilkens.
One Society draws on a wealth of research which shows that large divides in income at the top and bottom of society – beyond ‘proportional rewards’ – are damaging to our economy and society.

One Society works with policy-makers, employers, and other decision-makers and influencers who have significant power to affect rates of income inequality.Read the full story »

Policy ProposalsOne Society works with policy-makers from all political parties at both a national and a local level. We address some of the recent evidence and trends of UK inequality and propose potential policy solutions …
Pay RatiosOne Society has produced a brand new report to focus attention on the full extent of top to bottom pay ratios in the UK, including comparisons to company performance and analysis of specific sectors …