Sensible Pay & Remuneration Ratios

As I understand it Japanese law sets down that there should not be more than a multiple of more than 13 between the lowest paid worker and highest paid director or executive of an organisation.

I like this very much because it provides two barriers. Not just an upper limit but a lower limit too.

I would suggest that in the UK we should use a multiple of no greater than 20x – so if I as chief executive wish to be paid, say, £300,000 per year I would have to pay the lowest paid person in my organisation £15,000.

Put another way (using the current minimum wage as set out on the official Directgov web page, £6.08 per hour) the minimum wage UK employee (who does approximately 378 hours per week for 48 weeks a year) would earn £10,798 which would mean the highest level of pay would be £215,961.

Sounds fair to me.

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