Lloyds Banking Group staff are happy with the chief executive António Horta-Osório’s £6.3m pay package because they see him as “a winner” with charisma, the chair of the bank’s remuneration committee has told MPs.
Addressing the work and pensions committee, Stuart Sinclair said there was no discernible resentment among workers about the gap between the pay and pensions of those at the top of the organisation and the rest of the workforce.
“I don’t see that sort of discord. People like a winner. And when I go out to see people on £22,000, £30,000, £40,000, they see António as a winner because he brought this bank back from the brink … and people regard that as a big achievement.
“And there is a charisma around António which actually means a lot of people say: ‘Good luck to him. He works incredibly hard and I don’t resent the money.’”
However, Sinclair’s comments angered employees who contacted the Guardian. Lloyds has made thousands of workers redundant in recent months, and has closed branches across the country as the bank tries to reduce its costs, faced with a decline in face-to-face banking.
The bank has also irked some employees with cuts to staff benefits, including putting subsidised mortgages offered to staff under review after March 2020.
One employee, a claims handler in one of Lloyds’ regional offices who asked to remain anonymous, said that he was “quite infuriated” with the justification of executives’ high pay.
“Telling MPs that we’re happy with that figure, it’s insulting,” said the claims handler, who is paid about 300 times less than the chief executive. “They’re taking and taking and taking from the staff, and they’re giving and giving and giving to António.”
The average salary of a Lloyds bank teller in the UK is about £20,000, and for a branch manager it is £30,000. Last year Horta-Osório received fixed pay of £2.9m, including salary and pension, with his package rising to £6.3m once additional share awards and long-term incentives were factored in.
Horta-Osório rejected the accusation of by Frank Field, the chair of the cross-party committee, that he was being greedy when the average Lloyds employee was paid £37,000. Field suggested that other banks, such as HSBC, were doing a better job of making changes.
“Mr Field it is very difficult to accept the word greed that you used according to your own example when my total fixed compensation is lower than the group chief executive of HSBC,” Horta-Osório said during the session onexecutive pensions .
The Lloyds chief said that while he was mindful there was more to do, the bank was already taking action to address inequalities and reward staff. These included bigger percentage pay rises for the lowest paid, a total of £600 of shares awarded to all staff over the past three years and paying the real living wage across the UK.
Earlier this year, Lloyds cut Horta-Osório’s pension entitlement from 46% of his salary to 33%. However, this is still well above the maximum 25% target set by the Investment Association, an influential investors’ trade group. It is also well above the 13% average received by Lloyds employees.
Horta-Osório was forced in March to give up a final salary pension, after he had overseen the end of the lucrative perk for other employees at the bank – although that move only cost him £3,000 per year.
At the same time, Lloyds’ share price – closely followed by staff who are encouraged to buy stock in the company – remains at 59.2p, below its level on 1 March 2011, when Horta-Osório began his tenure as chief executive.
