Stelios fury at easyJet directors in pay row

Go ahead and resign, says tycoon, we'll just find cheaper people to fill your jobs
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The Independent Online

Discontent over excessive corporate pay exploded at the budget airline easyJet with Sir Stelios Haji-Ioannou's angry reaction to directors who threatened to quit over his plans to curb remuneration in the boardroom.

"Stelios", who founded the airline 17 years ago and remains a major shareholder, was furious with non-executive directors who, at the weekend, warned they saw his threatened vote against a pay deal as a "motion of confidence", raising the spectre of mass resignations.

The entrepreneur yesterday urged his fellow investors to call their bluff, responding that if they did quit, the company would simply replace them.

His response chimes with a growing public feeling that executive pay is out of control at a time when the rest of the country is suffering minimal pay rises and possible redundancy.

Sir Stelios, pictured, declared: "These guys are welcome to resign anytime, We could easily replace them with talented executives and experienced non-executive directors who will cost half as much in bonuses. We must take a stand against directors who seem to regard our company as their personal piggy bank to be dipped into at will. The gravy train of £180m in free shares issued over the last decade must come to an end now."

The row highlights the growing confidence among investors to fight against boardroom pay.

Last week, the oil and gas explorer Cairn Energy slashed the pay package of the chairman, Sir Bill Gammell, after shareholders complained it was excessive.

Vince Cable, Business Secretary,has tabled reforms to make shareholder votes on pay legally binding oncompanies.

Last year, Sir Stelios succeeded in securing the backing of more than half of the airline's shareholders to vote against an earlier payout to directors.

That was only an advisory resolution, but this year he is venting fury about a pay deal that could award 10 executives shares worth £8m over the next three years. Sir Stelios has written to David Cameron, accusing easyJet's board of making performance targets easier so that directors' share payouts are more easily attainable.

Last week, he claimed easyJet had used "phony calculations" to work out bonuses, and on the day the airline said it would pay its chief executive, Carolyn McCall, a bonus worth £840,000, on top of her £1.5m salary, Sir Stelios said: "The gravy train has gone wild at easyJet ... we must stop it."

The entrepreneur's long spat with easyJet's board and management has coincided with a raft of departures, including finance director and then-chairman, Sir Colin Chandler, in 2009. Five out of the eight executives on its board then resigned over the course of the year.

Sir Colin's replacement, the former KPMG grandee Sir Michael Rake, has been heavily criticised by Sir Stelios in recent months – but he has hit back by calling his pay claims "inaccurate, inappropriate and misleading".