Huge CEO Salaries, Pathetic Worker Salaries, Fair - You Decide

My post on the question of whether we should consider self-employment as a better option than working for a company has started some debate with most opinions saying that working for companies is the best route to take. An article I read in the German Spiegel online (sorry it is in German) adds to this debate in quite a different way, but nevertheless makes a point with a sledgehammer!

In this report it states that as in previous years, senior management’s earnings have increased, while at the same time negotiating with trade unions to try and keep increases of wages as low as possible. On average top management paid themselves at an increase of 16.9% higher in 2006 than in the previous year. At this stage 27 companies listed on the German stock exchange have submitted their 2006 annual financial reports. The highest paid CEO, so far, is Reitzle at the company Linde. He pays himself a cool €7.37 million. Daimler-Chrysler CEO Zetsche received €7.15 million for 2006. However it is rumoured that the man in charge of Deutsche Bank might still top these as he had pocketed €11.9 million the year before, and it is highly unlikely that he will earn less than that in 2006.

One of the reasons why CEO’s are able to get away with these kinds of extraordinary salaries is the fact that the economy has provided the opportunities for these and other companies to post solid growth in the region of 18.33%. It seems that shareholders, who would need to approve remuneration packages of the top brass, are only concerned with growth of return on investment rather than with equality issues. I am going to guess this, having had a quick look at salaries in the banking sector in the UK on a recruitment site, but a teller or a secretary at Deutsche Bank would earn around €40 000.00 per annum.

I can hear the supporters of these pay packages already, screaming their heads off. Their reasoning is that without CEO’s who steer the company into these profits, there would be no jobs for the little people. It would therefore be important to keep the leaders happy so that they would not consider moving to another company. This presumption is based on the fact that there are many tellers and secretaries available in the work force, but few top-notch leaders. On the other hand, no matter what availability of staff, the bank wouldn’t be able to function without tellers or secretaries. Each one of these employee’s contributes to the profitability of the organisation.

However, businesses approach the workers in a company as an overhead. They are not people. They are an expense. Good CEO’s keep expenses as low as possible. And if required, these expenses get fired. There are now even specialist CEO’s who are really good at cutting costs - read firing people. That’s what they are called in to do. This is the employment world we buy into. Does this sound reasonable and fair?

Article Source: http://www.new.citynewslive.com

Anja Merret lives in Brighton, UK. She has recently started a blog and writes on issues that interest her from self-improvement to tech stuff for amateurs. Anja has had a varied and interesting career journey. She started as a high school teacher, changed professions to become an admin manager at her late husbands law firm because this allowed her the flexibility to look after her small children at the time. After many years she left this position to try her hand at an art gallery, moved across to public relations and finally found her niche in education again managing a computer training centre for many years. During this time she also involved herself in writing standards and qualifications in the new media field. 10 months ago she moved from South Africa to join her younger daughter. She now writes a blog and also looks after the business interests of her daughter who is a Flash and Accessibility expert. She has BA (Hons) MBA degrees and on rare occassions she feels like a frustrated wannabe academic. That passes quickly though. www.anjamerret.com

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