The highest paid director at Bowmer & Kirkland is to receive £10.2m for 2009, by far the highest wage in construction, even though the firm’s pre-tax profit fell by a third
Bosses at the Derbyshire-based contractor have chosen the deepest recession for 60 years to hand out what is thought to be the first ever eight-figure pay packet in the building industry.
The salary, believed to be for chair John Kirkland, is up more than 50% on last year’s figure of £6.7m and is almost three times the rate of the next top payer in the industry, Wates Group, which paid its top executive £3.8m in 2009.
In total, Bowmer directors will receive £20.7m, up 40% on 2008.
The news comes as other high-paid directors have cut salaries over the past year, with the top pay at Stewart Milne, Carillion and Berkeley Group all falling.
One fellow construction chief executive said: “It’s excessive and a bit insensitive in an industry that is already suffering. It doesn’t make it easy to cut staff costs or salaries because staff will see it as one rule for one and one rule for another.”
It’s excessive and a bit insensitive in an industry that is already suffering
Another construction boss said it was difficult to compare the pay of owners of privately held companies with chief executives of listed companies, as they take on more risk and can take profit from the firm in different ways.
Helen Kersley, economic researcher at the New Economics Foundation, said: “As well as a moral issue here, there is strong evidence it is bad for both morale and productivity when directors receive extremes of pay.”
Bowmer saw its pre-tax profit fall by a third to £28.8m, on a marginally reduced turnover of £874m. However, unlike other firms making staff redundant in 2009, it took on 200 more people. Average pay was £44,199, compared with £40,386 last year.
Bowmer & Kirkland declined to comment.