Labour study exposes pay inequalities

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The Independent Online
HUGE pay gaps between top managers and their workers are revealed in research findings published today.

The widest differential was enjoyed by Henry Wendt, of SmithKline Beecham, the pharmaceuticals company, whose pounds 1.8m earnings were 215 times the pounds 8,362 wage of the lowest-paid manual worker in the group's consumer products division.

The second biggest gap found in a study by the union-backed Labour Research Department was between Lord Hanson, chairman of the Hanson conglomerate, who earns pounds 1.38m a year, and a manual worker at London Brick, one of the company's subsidiaries, whose rate was pounds 6,832.

The biggest disparities were found in the private sector, although the 30 per cent increases recommended for top government employees would greatly increase the gaps in the public sector, the department points out. Sir Bob Reid, the pounds 200,000-a-year chairman of British Rail, already earns 40 times as much as his lowest- paid workers.

Differentials in privatised industries are also below those in the rest of the private sector, but are 'well on their way' after a few years outside state control, the department says in the latest issue of its Labour Research journal.

The department says that the most controversial difference was at BT, where Iain Vallance, who earns pounds 536,303 a year as chief executive, is in the process of cutting tens of thousands of jobs. Mr Vallance earns 56 times as much as the lowest-paid of his workers, whose annual wages are pounds 8,223.

Labour Research Volume 81, Number 7; Labour Research Department, 78 Blackfriars Road, London SE1 8HF; pounds 2.25