Wage ratio: Difference between revisions
→Attempts at changing wage ratios: put all US actions in one paragraph. Internal link to the Dodd-Frank Act. |
m →Attempts at changing wage ratios: transparency, and regulation |
||
| Line 5: | Line 5: | ||
== Attempts at changing wage ratios == |
== Attempts at changing wage ratios == |
||
With the wage ratio steadily climbing, there has been a push to have increased transparency in publicizing the ratio for many of the world's largest companies. There have been a number of movements around to the world to attempt to regulate the pay ratio between executives and workers. |
With the wage ratio steadily climbing, there has been a push to have increased transparency in publicizing the ratio for many of the world's largest companies. There have also been a number of movements around to the world to attempt to regulate the pay ratio between executives and workers. |
||
'''Canada''': [[Wagemark|The Wagemark Foundation]], a Toronto-based not-for-profit organization is working to create an international wage standard certifying organizations that can prove they operate with a wage ratio of 8:1 or lower. |
'''Canada''': [[Wagemark|The Wagemark Foundation]], a Toronto-based not-for-profit organization is working to create an international wage standard certifying organizations that can prove they operate with a wage ratio of 8:1 or lower. |
||
Revision as of 05:01, 3 May 2017
In economics, the wage ratio refers to the ratio of the top salaries in a group (company, city, country, etc.) to the bottom salaries. It is a measure of wage dispersion.
There has been a resurgence for the importance of equitable wage ratio. The amount of money paid out to executives has steadily been on the rise. "An April 2013 study by Bloomberg finds that large public company CEOs were paid an average of 204 times the compensation of rank-and-file workers in their industries. By comparison, it is estimated that the average CEO was paid about 20 times the typical worker’s pay in the 1950s, with that multiple rising to 42-to-1 in 1980, and to 120-to-1 in 2000".[1] While not as extreme, similar trends have been observed around the world.
Attempts at changing wage ratios
With the wage ratio steadily climbing, there has been a push to have increased transparency in publicizing the ratio for many of the world's largest companies. There have also been a number of movements around to the world to attempt to regulate the pay ratio between executives and workers.
Canada: The Wagemark Foundation, a Toronto-based not-for-profit organization is working to create an international wage standard certifying organizations that can prove they operate with a wage ratio of 8:1 or lower.
Spain: In 2013, the Spanish Socialist Workers Party, the official Spanish opposition party, adopted a ratio as part of their official policy.[2] The Mondragon Corporation, a worker-owned cooperative headquartered in the Basque Country, has an internal wage ratio at an average of 5:1, periodically decided with a democratic vote.[3]
Switzerland: Popular Initiative "1:12 Initiative - For fair wages" was a Swiss referendum held on November 24, 2013 in an attempt to create legislation limiting the amount of executive pay to a maximum of 12 times that of the lowest paid workers. The referendum was rejected by 65.3%, with a turnout of 53%, and no canton took on the initiative. The largest rejection came form the canton of Zug, accepted by only 23% of the votes, and the least rejection came from Ticino, where it was supported by 49%.[4][5]
United Kingdom: In 2017, the Leader of the Opposition Jeremy Corbyn called for an enforced wage ratio for any company awarded a government contract, of 20:1 between the executives and the lowest-paid employee. A similar call was previously made by Prime Minister David Cameron in 2010 for the public sector.[6][7]
United States: In 2010 President Barack Obama signed into effect the Dodd–Frank Wall Street Reform and Consumer Protection Act. In short, Section 953(b) of the Dodd-Frank Act changed the regulation regarding CEO compensation disclosure to shareholders.[8] In December 2016, the city of Portland, Oregon voted to implement a surcharge for chief executives who earn more than 100 times the median pay of their workers in 2017.[9]
See also
References
- ^ Aguilar, Louis A. "SEC Open Meeting". Retrieved 6 December 2013.
- ^ http://www.businessinsider.com/switzerland-to-vote-on-executive-pay-law-sunday-2013-11
- ^ Herrera, David (2004). "Mondragon: a for-profit organization that embodies Catholic social thought" (PDF). Review of Business. 25 (1). The Peter J. Tobin College of Business, St. John's University: 56–68. Archived from the original (PDF) on 2010-07-14. Retrieved August 29, 2014.
- ^ "65,3 Prozent sagen Nein zur 1:12-Initiative" [65.3 Percent Say No to 1:12 Initiative]. SRF Online. Retrieved 24 November 2013.
- ^ "Eidgenössische Volksinitiative '1:12 - Für gerechte Löhne'" [Federal Popular Initiative "1:12 - For fair wages"]. Government of Switzerland. Retrieved 2017-02-12.
- ^ https://www.theguardian.com/politics/2017/jan/10/corbyn-proposes-maximum-wage-for-all-government-contractors
- ^ http://www.wagemark.org/about/history/
- ^ http://www.sec.gov/News/Speech/Detail/Speech/1370539813937#.UqD9NxbFnww
- ^ https://www.nytimes.com/2016/12/07/business/economy/portland-oregon-tax-executive-pay.html