Pay Equality – Is It Fair?

Last week, the BBC published details of all employees earning over £150,000 per annum.

Newspapers and social media have gone into overdrive since with comments, criticisms and counter criticisms including issues such as:

1. Salary gender gap – only 2 of the top 9 earners are female.

2. Some employees are still being paid through personal service companies leading to accusations of tax avoidance and a lack of transparency.

3. Diversity – of employees earning over £150,000 per year, 88.5% of these are white.

4. Some presenters who appear to be doing exactly the same job are paid significantly different amounts (e.g. Dan Walker and Louise Menchin from BBC Breakfast).

Top Earners Making the Headlines

From the information published, Chris Evans (Radio 2 Breakfast Show and Top Gear presenter) earns over £2.2m per year.

Gary Lineker (Match of The Day and various other football programmes) earns over £1.75m.

The top female earner is Claudia Winkleman (Strictly Come Dancing and Others) earning over £450,000 per annum.

Earnings and Take Home Pay

Various publications have referred to Chris Evan’s take home pay being over £2.2m. However, with the bulk of these earnings being subject to a top combined rate of income tax and national insurance of 47%, over £1million will have been paid in tax and national insurance leaving his actual take home pay a measly £1.18 million.

It is unlikely to attract a great deal of sympathy from most commentators!

Alternative Arguments

Many commentators have noted that discrepancies in pay are a factor of market conditions and boil down to demand and supply. Many of the BBC presenters can (and would) demand comparable salary levels if they worked elsewhere and, if the BBC want top presenters, they have to pay market rates.

It is noted that Ant & Dec (who work primarily for ITV) earn more than any of the BBC’s top earners – reinforcing the argument that the BBC has to pay market salary rates – or lose their presenters. 

Gary Lineker’s agent has noted that the agents working for other presenters are failing their clients if they are doing the same job as co presenters and are earning less money.

Chris Evans sought advice from his 91 year old mother who advised him “earn what you can, when you can, while you can. And tell them if your bosses don’t think you’re worth it one day, they’ll sort that out soon enough”.

Future Fallout

Companies with more than 250 employees must publish their pay gap figures by April next year, and it appears that banks and financial services companies are expected to be particularly worried by the fallout.

Perhaps a more radical approach would be the current suggestion from Labour that there should be a maximum ratio of 20 to 1 between the highest and lowest paid staff in public sector organisations. This would mean an 80% pay cut for Chris Evans. Whether this would result in top presenters leaving public sector organisations such as the BBC would remain to be seen.

It is highly likely that the furore over equality and fair pay is likely to increase rather than decrease as more information is published in the public domain going forwards.

Article written by Declan McCusker