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Concern over addressing "excessive" executive pay

While there is a consensus that "excessive" executive pay must be tackled, pay experts have expressed concern that stakeholders could vote on pay packages without fully understanding a company's remuneration policy.

The discussion follows the Queen's Speech at the House of Lords on May 9, which unveiled measures to help boost the economy. Many are included under the Enterprise and Regulatory Reform Bill, which the Government is expected to bring forward imminently. This will reform director's pay by introducing binding shareholder votes.
Continue reading Concern over addressing "excessive" executive pay.
Jo Doonar Posted by Jo Doonar
on May 17, 2012 2:37 PM 		| | Comments (0) | TrackBacks (0)

Private sector pay forecasts 2012: How does your organisation compare?

HK Dragon Centre Sky Fantasia CoinsHow will your organisation's 2012 pay award compare with those at other organisations in the private sector? And how will it stack up against projected movements in inflation?

A new service from XpertHR makes it easy for you to find out.

XpertHR private sector pay forecast benchmarker
XpertHR's private sector pay forecast benchmarker spreadsheet enables you to see how your organisation measures up against the latest pay forecast benchmarking data from XpertHR, and against latest expert inflation forecasts compiled by XpertHR.

All XpertHR subscribers can access this benchmarker spreadsheet.

Benchmarking Private Sector Pay Forecasts for 2012
More about XpertHR Benchmarking
  • XpertHR Quick Benchmarker All XpertHR subscribers can get a taste of what XpertHR Benchmarking has to offer through the XpertHR quick benchmarker, which allows you to compare how your organisation is performing against five key metrics - including latest data on ratios of employees to HR staff in 2012.
  • XpertHR Benchmarkers XpertHR's benchmarker spreadsheets provide you with a quick and easy way to measure and monitor your organisation's performance on key HR measures against the latest XpertHR Benchmarking data.
  • XpertHR Benchmarking Visit the XpertHR Benchmarking homepage.
Michael Carty Posted by Michael Carty
on March 29, 2012 7:00 AM 		| | Comments (0) | TrackBacks (0)

Subdued pay rise of 2% expected in the year ahead

Private sector employers are predicting pay awards of just 2% in the year to 28 February 2013 [£] according to data from pay specialists XpertHR.

The slow economic recovery is continuing to influence organisations, with pay freezes and redundancies forecast by some, but a pay rise is on the cards for most employees. Our survey found:

• More than three-quarters of respondents (76.1%) say they are planning to award a pay rise on the normal review date. Around a tenth of organisations are forecasting a pay freeze.
• The median pay rise forecast for the private sector overall is 2% - but this rises to 2.5% when not-for-profit organisations are excluded.
• Half of all organisations surveyed expect to award rises worth between 2% and 3%.
• Employers in the manufacturing and production sector are forecasting a median 2.5% pay rise over the next year, compared with a 2% forecast by private sector services firms.
• Only 9.9% of organisations expect to give an award worth more than 2012's RPI forecast of 3.2%.
• Approximately half (48.3%) of the organisations surveyed expect some change to other employee terms and conditions. Of those giving details, 34.4% expect to make at least some redundancies and a quarter will review their benefits.
• Almost one-quarter (23.2%) of respondents say pension costs generally will be a downward influence on pay awards and 17.5% say pension costs due to the introduction of auto-enrolment are likely to restrain pay.

Employers do not feel under pressure to compensate for several years of low/zero pay rises - only 16.6% of organisations think the 2012 pay deal needs to makes up for previous low awards. Additionally, more than three-quarters (76.4%) of organisations feel that employees have accepted the need for pay restraint - this may be because organisations have 'stuck together', keeping in-line with competitors in terms of rates of pay.

The figure from our pay forecast survey is lower than our current median pay award of 2.6% for the three months to 29 February 2012, but organisations may be wary of committing to higher pay rises and some feel burdened by pension changes. Additionally, the not-for-profit sector, which tends to take its lead from the public sector in terms of pay awards, accounts for more than one-fifth of respondents to this survey.

XpertHR Pay and Benefits editor Sheila Attwood said:

"Although we might expect employees to be tiring of low pay rises or pay freezes, our survey respondents indicate that to date they have understood about the economic challenges that organisations face. However, a median 2% increase during 2012 will result in another of year of below-inflation pay rises."

Sheila Attwood Posted by Sheila Attwood
on March 26, 2012 9:19 AM 		| | Comments (0) | TrackBacks (0)

National minimum wage 2012/2013: Adult rate increases by 1.8% to £6.19 per hour; younger workers' rates frozen

Vince_Cable.JPGThe Coalition Government has today (Monday 19 March 2012) announced the national minimum wage rates for 2012/2013, which come into effect from Monday 1 October 2012.

It has accepted the Low Pay Commision's (LPC) recommendations as set out in its 2012 report, which was delivered to the Coalition Government last month.

The national minimum wage adult rate will be increased by 11p per hour with effect from 1 October 2012. Howevever, the national minimum wage rates paid to younger workers will be frozen at their 2011/2012 levels.

Business Secretary Vince Cable says that freezing younger workers' national minimum wage rates was "a very hard decision."

National minimum wage adult rate to increase by 1.8% from 1 October 2012
The national minimum wage adult rate for 2012/2013 is as follows:
  • The national minimum wage adult rate will increase to £6.19 per hour for 2012/2013, with effect from 1 October 2011.
  • This represents an increase of 1.8% from the 2011/2012 national minimum wage adult rate, which currently stands at £6.08 per hour (from 1 October 2011 to 30 September 2012).
  • The 2012/2013 national minimum wage adult rate (at £6.19 per hour) is therefore set 11p per hour higher than the 2011/2012 rate of £6.08 per hour.
National minimum wage rates for younger workers frozen for 2012/2013
The national minimum wage rates paid to younger workers will be frozen for 2012/2013 (again with effect from 1 October 2012):
  • The national minimum wage "youth development rate" (for workers aged 18 to 20) will remain at £4.98 per hour for 2012/2013, unchanged from the rate for 2011/2012.
  • The national minimum wage youth rate (for workers aged 16 and 17) will remain at £3.68 per hour for 2012/2013, unchanged from the rate for 2011/2012.
National minimum wage apprentice rate to increase by 1.9% from 1 October 2012
Apprentices will, however, see an increase to their national minimum wage rate:
  • The apprentice minimum wage rate will rise from £2.60 per hour to £2.65 per hour (an increase of 5p per hour, or 1.9%).
Cable: Freezing younger workers' rates was 'a very hard decision'
Business Secretary Vince Cable comments:
I believe that the recommendations of the Low Pay Commission strike the right balance between pay and jobs, and have therefore accepted all the rate recommendations. The Low Pay Commission has done a good job in difficult circumstances. In these tough times freezing the youth rates has been a very hard decision - but raising the youth rates would have been of little value to young people if it meant it was harder for them to get a job in the long run.
Continue reading National minimum wage 2012/2013: Adult rate increases by 1.8% to £6.19 per hour; younger workers' rates frozen.
Michael Carty Posted by Michael Carty
on March 19, 2012 10:20 AM 		| | Comments (1) | TrackBacks (0)

Changes made to ONS' Basket of Goods and Services

The basket of goods, which is used to calculate the UK's rate of inflation, has had its annual overhaul - with tablet computers and teenage fiction going in the basket, while developing colour film has come out.

Updated annually by the Office for National Statistics (ONS), the CPI and RPI Basket of Goods and Services (external website) contains over 700 items for which the prices are collected every month. Tracking these prices ensures that CPI and RPI are up-to-date and representative of consumer spending patterns. Movements in the CPI and RPI represent the changing cost of the representative shopping basket.

Items going into the basket include baby wipes to represent 'cleansers on the go'; bundled communication packages comprising telephone services, internet access and television subscriptions; tablet computers (over the years more computer equipment has been added including desktop personal computers and laptops); and teenage fiction now warrants its own category as there has been an increase in spend in this area.

Continue reading Changes made to ONS' Basket of Goods and Services.
Jo Doonar Posted by Jo Doonar
on March 13, 2012 3:58 PM 		| | Comments (0) | TrackBacks (0)

Pay awards start 2012 on positive note

Employees are enjoying the highest pay rises seen since December 2008, according to the latest pay settlement data from XpertHR [£].

The median pay rise in the three months to the end of January 2012 stands at 2.5%, up from 2.3% in the same period a year ago. This is unchanged on the figure for the previous rolling quarter, confirming that the upward trend in pay settlement figures first seen in December 2011 has been sustained.


Continue reading Pay awards start 2012 on positive note.
Rachel Sharp Posted by Rachel Sharp
on February 24, 2012 10:30 AM 		| | Comments (0) | TrackBacks (0)

National minimum wage 2012/2013: Rates for younger workers 'most likely to be frozen', says Telegraph

Frozen!The national minimum wage adult rate could be increased with effect from 1 October 2012, but the rates paid to younger workers are "most likely to be frozen" in 2012/2013. This is according to the Daily Telegraph.

The CIPD last year called for the national minimum wage rates paid to younger workers to be frozen in 2012/2013.

National minimum wage rates for younger workers 'most likely to be frozen' in 2012/2013, says Telegraph
Given the current backdrop of ongoing economic uncertainty, rising unemployment and falling inflation, news of the annual increase (or otherwise) to the national minimum wage for 2012/2013 (due to come into effect on Monday 1 October 2012) will be particularly closely watched.

The Telegraph says:
The separate [national] minimum wage rates for young people are the most likely to be frozen to make it easier for firms to offer jobs to one million under-25s who are out of work.
The national minimum wage rate for workers aged 16-17 inclusive is currently set at £3.68 per hour, while the national minimum wage development rate (paid to workers aged 18 to 20 inclusive) is £4.98 per hour and the apprentice rate is £2.60 per hour. See XpertHR's statutory rates pages for full details of the current national minimum wage rates (XpertHR subscription required).

BIS and CIPD favour freezing national minimum wage rates for younger workers
Both the BIS and the CIPD favour freezing national minimum wage rates for younger workers in 2012/2013.

The Telegraph reports that "in its own evidence to the [Low Pay Commission (LPC)], BIS warned that increases in the minimum wage made employers more reluctant to hire." It quotes the BIS submission as follows:
There are [...]  reasons to be cautious and moderate in recommending NMW (National Minimum Wage) rates for young people. Evidence suggests that labour market outcomes of younger workers are more at risk from the uprating of the NMW.
In its submission to the LPC late last year, the CIPD called on the LPC to recommend that national minimum wage rates paid to younger workers be frozen in 2012/2013.

In a Twitter discussion with me and @neilmorrison on Monday 3 October 2011, the CIPD stated that it believes that the "national minimum wage is harming youth employment in some sectors," and should therefore be frozen next year (although it notes that this is "a finely balanced decision").

The CIPD also said (again via Twitter): "we've called for a freeze in past. We support NMW, but with rising unmplyment, temp freeze may be for greater good." The CIPD believes that such a national minimum wage freeze for 2012/2013 should be confined to younger workers. It says that the "adult rate appears to have less overall impact but there are variations by region & sector. So policy focus wld be on the yth rates."

The CIPD argues that it would like to see national minimum wage rates for younger workers frozen until the economy recovers: "The freeze could be absolute or relative, but would last until we see more robust growth."

Access the CIPD's full submission to the LPC here.
Continue reading National minimum wage 2012/2013: Rates for younger workers 'most likely to be frozen', says Telegraph.
Michael Carty Posted by Michael Carty
on February 21, 2012 11:45 AM 		| | Comments (0) | TrackBacks (0)

Forecast pay awards for 2012- take part

Early indications from data collected by XpertHR has revealed that pay settlement levels so far in 2012 are well above the levels seen in 2011 and the preceeding years of the recession.

Is this due to employers feeling more confident about the economy, employee pressure, or making up for years of low pay rises? And will it continue?

To find out, XpertHR are launching a confidential pay forecasting survey which will establish likely pay trends over the coming year. We would greatly appreciate your assistance with our research by completing our questionnaire.

The survey is entirely confidential, and all respondents will receive a copy of the report as soon as it is published at the end of March.

Click here to take part.

Sheila Attwood Posted by Sheila Attwood
on February 7, 2012 9:14 AM 		| | Comments (0) | TrackBacks (0)

The national minimum wage: 'A machine to destroy jobs'?

Tidjane Thiam - Annual Meeting of the New Champions 2011 "The minimum wage is a machine to destroy jobs." This is according to Prudential Chief Executive Tidjane Thiam, speaking at the World Economic Forum in Davos, yesterday (Thursday 26 January 2012). Thiam argued that the national minimum wage is a "false social policy" designed to protect workers, but which serves to prevent the unemployed from finding work.

National minimum wage: Crowding out the unemployed?
According to the Daily Telegraph, Thiam said:
The minimum wage is a machine to destroy jobs. Look at France and Le Pen. The minimum wage is the enemy of young people entering the labour market. They don't have a voice. [...] Unions represent people already in jobs so they always support minimum wages. That crowds out the unemployed. People can't get full time employment. They move from fixed-term contract to fixed-term contract.
Thiam's comments come in the run-up to the announcement of the national minimum wage increase for 2012/2013, which will come into effect from Monday 1 October 2012.

What can we expect from the October 2012 national minimum wage increase?
Given the current backdrop of ongoing economic uncertainty, subdued pay awards, rising unemployment and falling inflation, news of the annual increase to the national minimum wage for 2012/2013 (due to come into effect on Monday 1 October 2012) will be particularly closely watched.

The Low Pay Commission (LPC) is scheduled to deliver its 2012 report - which will set out its recommendations for the 2012/2013 national minimum wage rates - to the Government by the end of February 2012.

The Government will then announce the national minimum wage rates for 2012/2013 a few weeks later, although we do not yet know if this will form part of Chancellor George Osborne's Budget 2012 speech on Wednesday 21 March 2012.

As XpertHR notes, it is not a foregone conclusion that we will see any increase to the national minimum wage in 2012/2013.

The Telegraph's Head of Business Damian Reece argues that "the [national] minimum wage [must be] set at an appropriate level," and suggests that "a helpful start to minimum wage reform might be a moratorium on any further rises, at least for another two years."
Continue reading The national minimum wage: 'A machine to destroy jobs'?.
Michael Carty Posted by Michael Carty
on January 27, 2012 8:25 AM 		| | Comments (0) | TrackBacks (1)

Pay rises highest for three years

The first analysis of pay settlements effective in 2012 reveals a marked increase in the level of awards made, according to pay specialists XpertHR.

Pay rises effective in January 2012 - exclusively in the private sector due to a lack of public sector bargaining at this time of year - are worth a median 2.8%. This is the highest level seen since December 2008 (when the private sector median stood at 3.7%).

This is well above the 2% to 2.5% median increase seen through 2011 in the private sector, and above the 2.5% median recorded in the three months to the end of December 2011.

Pay freezes continue to feature in our analysis, with our sample including six settlements where pay has been frozen. However, almost half (48.8%) of January 2012 pay deals are worth 3% or more, and 3% is the most common pay increase recorded.

Manufacturing pay awards continue to outstrip those in the services sector, something that we have seen since April 2010. Among the pay awards effective in January 2012, the median pay increase in the manufacturing sector is 3%, compared with 2.5% in private sector services.

The pattern of higher pay awards in the first few months of the year was something we saw in 2011 - the level of pay increases fell in April 2011 when the public sector pay freezes were added to the calculations and pay awards in the service sector were low. We can again expect a flurry of public sector pay awards worth nil to be added to the data in April, but remain hopeful that private sector pay awards will maintain their upward trend.

The increase in pay awards is set against a marked fall in retail prices index (RPI) inflation - to 4.8% in December 2011. If the pace of decline in inflation continues, there is a real opportunity for employers to make up for years of low pay rises with an increase this year that is worth more than inflation.

 

XpertHR Pay and Benefits editor Sheila Attwood said:

"The data collected to date suggests that pay bargaining in 2012 has got off to a good start and that, for many private sector workers, pay rises higher than the levels seen in 2011 are a real prospect.

"Over the past few months we have started to see evidence of a shift to higher pay awards than were made the year before. We now find that the majority of pay awards are at a higher or the same level as paid to the same group of employees the year before, with only a handful making lower awards."

Sheila Attwood Posted by Sheila Attwood
on January 20, 2012 12:01 AM 		| | Comments (0) | TrackBacks (0)
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