- Union body calls on UK financial institutions to “do the right thing” and not to follow the example of Goldman Sachs
- TUC warns of “huge disconnect between Britain’s boardrooms and hard-pressed families”
The TUC has today (Tuesday) called on UK banks to “show restraint” and not to abandon the cap on bankers’ bonuses for senior staff.
The call comes after Goldman Sachs announced last week that it would be lifting the cap – following the Conservative’s decision to allow banks to hand out unlimited bonuses.
Under the previous legal cap an employee’s bonus could be no bigger than 100% of their annual pay, or 200% if there was approval from shareholders.
However, this cap on bonus payments was scrapped by former Chancellor Kwasi Kwarteng as part of Liz Truss’ mini-budget.
The union body says banks could still voluntarily decide not to pay bonuses at a higher rate than the previous cap.
Large bonus pool already
The TUC highlighted recent analysis which showed that even with the previous cap in place, UK banks paid out bumper bonuses in 2022 and 2023.
The union body says that in 2022 alone the annual bonus pool for workers in the finance and insurance sector was a huge £18.7bn.
TUC General Secretary Paul Nowak said:
“At a time when millions are struggling to make ends meet, it would just be plain wrong for banks to hand out even larger bonuses to those at the very top.
“I urge bank leaders today to do the right thing and show some restraint. Don’t follow the example of Goldman Sachs.
“The bankers’ bonus cap was put in place to stop the excessive risk-taking and greed we saw in the run up to the financial crisis. The Tories should never have abolished it.
“We cannot afford a return to the bonus culture which crashed our economy.
“If UK banks press ahead with abandoning the cap for senior staff it will be further proof of the huge disconnect between Britain’s boardrooms and hard-pressed families.”
