Leader of the Labour Party, and of The Opposition, Jeremy Corbyn has set out plans to curb boardroom pay
This follows reports of Corbyn suggesting a maximum wage or a maximum earnings cap.
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In a press conference, Corbyn explained that Labour would impose a 20:1 pay ratio on any firm receiving a public contract. This means that someone earning the living wage, slightly over £16,000 ($19,293) a year, would permit an executive of the same company to earn close to £350,000.
In any case, the maximum wage would be, according to Corbyn, ‘somewhat higher’ that his annual wage of £138,000 a year.
So how could this feasibly affect the banking sector in the UK?
As you can imagine, CEOs of UK-based banks earn a lot more than £350,000.
Even if the average wage of personal bankers was considered, rather than the living wage, there is a huge gap. According to Payscale, the average personal banker earns £18,000 a year. This would lead to a wage, according to the 20:1 ratio, of £360,000.
To put this into context, the CEOs of the top banks in the UK earned in the millions in 2015. Ross McEwan (RBS) earned $6.1m, Jes Stanley (Barclays) earned $6.9m, Antonia Horta-Osoria (Lloyds) earned $11m, and Stuart Gulliver (HSBC) earned $11.2m.
With that in mind, if the wage gap becomes legislation, which is very unlikely, there is certain to be at least one huge sector left unhappy.
