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You are here: Home > Educators > Level 2 Business and Economics Education > Directors' Pay: A Fair Deal? > Should a Business Increase its Director's Pay by 50%? |
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Directors' Pay: A Fair Deal? - Should a Business Increase its Director's Pay by 50%?What do you think? Should this business increase the pay of its director by 50%? Study the following four arguments and decide which is the best. Argument 1It would be unfair to pay the directors 50% more because the workers are getting only a small pay increase and they work just as hard. When the business does well it is just as much due to the workers as the directors. Workers have a right to high pay increases any time that a director gets a high pay increase. Argument 2The shareholders might want to pay the directors an extra 50% because profits have risen and they want the directors to stay with the company and not be tempted to go to a better paid job in another company. But the workers might be unhappy because they are not getting such a big rise. Argument 3Stopping directors getting big pay rises might mean they leave the company which could be bad for business. But if they do get a big pay rise all the other workers might protest if they get much less. If all the workers got paid partly through shares they could have a share of the profits too. Argument 4Paying all workers partly through shares might make them feel better when directors benefit from share ownership. So this could be a way of keeping directors and workers happy at the same time. But directors will benefit more because they get more pay which they can vote for themselves and it is bad for the country if directors get paid huge amounts when the business is not doing well. |
