Swiss Pay Gap Widened at UBS, Swatch Last Year, Report Shows
The pay gap between salaries awarded to top management and the lowest-earning employees increased at Swiss companies last year, according to a worker interest group.
At 18 of the 27 companies surveyed the pay gap between the executive board and lowest-paid workers widened, Travail Suisse, an umbrella organization of trade unions, said in a statement on its website today. Roche Holding AG (ROG), Novartis AG (NOVN), Nestle SA (NESN), UBS AG (UBSN) and Lindt & Spruengli AG (LISP) “stand out with wage gaps of over 1:200,” meaning that top earner gets 200 times more than the lowest-paid employee, it said. At UBS the gap widened to 1:229 in 2013 from 1:177 the previous year, while at Swatch Group AG (UHR) Chief Executive Officer Nick Hayek’s ratio increased to 1:151 from 1:137.
In November, Swiss voters rejected a proposal to limit executives’ pay to 12 times that of junior employees, after earlier last year passing a referendum to implement “fat-cat” rules, giving investors a greater say on executive salaries. Travail.Suisse argues the latter initiative, which was proposed by Thomas Minder to eliminate sign-on bonuses, severance packages, and extra incentives for merger transactions, has had little impact.
“The fat-cat initiative certainly won’t solve the problem,” the Bern-based organization said. “In the first year after its adoption the pay gap of the corporate management widened almost all over the country.”
The salaries of CEOs became a sore point with the Swiss public after UBS, the country’s biggest bank, was bailed out in 2008 and after drugmaker Novartis proposed and later abandoned a plan to pay as much as $78 million to outgoing chairman Daniel Vasella in 2013.
UBS, Switzerland’s biggest bank, in March boosted CEO Sergio Ermotti’s compensation by 21 percent to 10.73 million Swiss francs ($12 million), the last time the decision will fall exclusively on the bank’s board as the Swiss governance rules change.
To contact the reporter on this story: Carolyn Bandel in Zurich at firstname.lastname@example.org
To contact the editors responsible for this story: Frank Connelly at email@example.com Zoe Schneeweiss, Thomas Mulier