Employee shareholders expected to vote down bonuses

Senior executives face a summer of discontent over remuneration after unions warned that employees who owned shares would vote to reject senior bonuses.

Shareholders have voted against awarding bonuses to executives at several annual general meetings in recent weeks, including 80% of the Royal Bank of Scotland’s shareholders and 57% of oil giant Shell’s shareholders.

Following a 22% rise in full-year profits last week, weapons tester Qinetiq announced that it would cut 400 jobs from its workforce of 7,000, just weeks after it froze pay for its UK employees.

Only senior executives and top performers will receive a bonus for 2009, which unions described as a “slap in the face”. Union members at the company are voting on whether to take industrial action.

Prospect’s national secretary David Luxton said many of the union’s 2,000 members were also shareholders at the company, and would vote against awarding bonuses to senior executives at the AGM in August.

“We expect quite a revolt over directors’ remuneration come August, led by employees who have been slapped in the face by management,” he told Personnel Today.

“This won’t be the last time this summer you see angry employees making their opinions heard about undeserved bonuses at AGMs.”

The list of companies holding annual general meetings in the next few months include the bailed-out Lloyds Banking Group, which chose to continue awarding bonuses last October.