UK Chief Execs awarded average bonus of over £172,000 in 2021
According to an analysis of employee bonuses awarded between October 2020 and October 2021, by Cendex, part of XpertHR, chief executives received an average bonus of £172,897. Conversely, entry-level employees, and those categorised as ‘routine task providers’ were awarded an average bonus of £642 and £643, respectively.
The findings come shortly after the UK’s ‘high pay day’, where by 9am on 7th January 2022, a FTSE 100 chief executive will have been paid more than the median UK worker’s annual salary, according to the High Pay Centre.
Research from Cendex has found that 25% of chief executives were awarded a bonus in 2021, whilst only 10% of routine task providers were given a bonus.
|Senior function head||£21,500|
|Professional level 4||£4,079|
|Professional level 3||£2,727|
|Professional level 2||£1,561|
|Professional level 1||£910|
|Entry level professional||£642|
|Routine task provider||£643|
Source: Bonus payments by narrow job level, Cendex, October 2021
Cendex data shows that 36% of those at a director level or above received a bonus in 2021, and were awarded average bonus payments of £63,027, increasing by just over £9,000 when compared with 2020. 32% of those at manager level were awarded a bonus, with the average payment at £10,408. Less than a quarter, 22%, of remaining staff received a bonus, with an average payment of £1,418, an increase of just £61.
However, the seniority of an employee is not the only factor to influence what bonus is awarded. The industry staff work in also can play a role in bonuses awarded and how much is awarded. In the chemicals, utilities, food and drink, and transport industries, the proportion of employees with bonuses increase significantly, although the value of those payments has remained largely unchanged. In contrast, there was a reduction in the proportion of employees receiving a bonus in pandemic-affected sectors, such as hotels, catering and leisure.
Bonuses awarded also varied by region. Workers in Inner London received by far the highest average bonus of £8,236. The next highest paying region was a long way behind with workers in Northern Ireland seeing average bonuses of £3,266 – less than half the Inner London amount. Employees who work across multiple regions and classified themselves as “mobile” took home average bonuses of £4,806. Employees in Scotland and Wales saw significantly lower average bonuses of approximately £1,500.
Sheila Attwood, XpertHR pay and benefits editor, said: “From the rising cost of living to recovering from Christmas expenses, money is front of mind for many workers. An annual bonus is a well-received reward for many employees in recognition of the effort they have put in. But being paid at the right level is just as important and it is crucial that businesses get this right, achieving the balance between making an employee feel valued while remaining competitive in the market.
“Executive pay and bonuses have always been a point of contention. It’s critical that businesses remain competitive to get the right talent leading their organisation, and the salary and bonus awarded plays a huge role. But for the remaining staff, hearing about the big end of year bonus can cause tension. Businesses should leverage data and build effective and fair reward strategies that enable them to recruit and retain talent across all levels.”