Section 38 of the Localism Act 2011 requires the Authority to produce Pay Policy Statements, which will include the Authority’s policy on pay dispersion – the relationship between remuneration of chief officers and the remuneration of other staff.
Guidance produced under section 40 of that Act23, recommends that the pay multiple is included in these statements as a way of illustrating the Authority’s approach to pay dispersion.
The Authority, must, under this Code, publish the pay multiple, defined as the ratio between the highest paid salary and the median salary of the whole of the authority’s workforce. The measure must:
- Cover all elements of remuneration that can be valued (eg. all taxable earnings for the given year, including base salary, variable pay, bonuses, allowances and the cash value of any benefits-in-kind).
- Use the median earnings figure as the denominator, which should be that of all employees of the local authority on a fixed date each year, coinciding with reporting at the end of the financial year.
- Exclude changes in pension benefits, which due to their variety and complexity cannot be accurately included in a pay multiple disclosure.
Pay Multiple 2016-2017
- The salary of the median employee is £31,601
- The total salary and’ benefits in kind’ of the Chief Executive is £83,851