Unite the Union has written to the Financial Conduct Authority’s chief executive calling for “greater transparency” on the rationale which sits behind the regulator’s decisions regarding employee pay.
In a letter sent to the regulator on October 4, Nikhil Rathi was told a situation where staff do not have visibility on pay “can lead to unnecessary misunderstanding and discontent”.
Doing this would significantly improve staff relations.Steve O’Donnell, Unite the UnionThe letter, signed by Unite’s regional officer Steve O’Donnell, read: “Would you be prepared to give greater transparency on the general policies and principles that underlie the FCA’s pay decisions?
“It would not in itself cost the FCA anything to publish a statement setting out the relevant principles, such as the factors weighing on different sides and broad explanations of how benchmarking is undertaken.
“Doing this would significantly improve staff relations. People are more likely to accept a pay figure which is lower than they were hoping for if the factors that led to it are made transparent to them.”
The FCA has responded by saying it "understands more than most" the impact the cost of living crisis is having on its employees.
It added that it had put in place support, including a one-off payment to help staff.
The fresh call for pay transparency follows a series of strikes led by Unite and attended by FCA union members outside the regulator's Stratford office in May over changes to pay.
Unite previously wrote to the FCA over pay back in July. Since then, the regulator has introduced one-off payments of £1,000 for staff earning under £60,000 to help during the cost of living crisis, as well as payments in respect of home office equipment of £300 each, and the possibility of advances on salary for staff in hardship.
But Unite said in its letter that a one-off payment “is no more or less than that: a payment at one point in time”. Amidst rising inflation and tumultuous markets, the union said FCA members were “asking what the future will hold for them”.
FCA staff have also been told that there will be a headline pay rise of 4 per cent next year, subject to variations depending on performance. But the union argued this promise was made before inflation rose to 9.9 per cent.
The union has therefore asked Rathi whether he plans to reconsider the 4 per cent figure, and if so, when the outcome of that reconsideration would be announced to staff.
“We appreciate that there is a balance between using public money wisely and paying salaries which are sufficient to attract, motivate and retain able people to do the vital job of regulating the British financial sector,” said Unite’s O’Donnell.
“Our members are concerned that this balance was knocked out of kilter by the pay cuts that were imposed this year, and they are understandably seeking clarity on the future direction of travel for remuneration at the FCA, as living standards continue to come under severe pressure.”
Unite also raised two specific points regarding the regulator’s cost of living payment. It said it understood part-time staff will not receive the payment if their full-time equivalent salary is over the £60,000 cap, and that any payments that they receive will be reduced pro rata due to their part-time status.
“This seems inconsistent,” O’Donnell said. “If people are being held to the FTE cap, should they not receive the FTE payment?”
He also noted that the one-off payment will not be made to people on long-term leave until they return to work. “As these people will be experiencing the same financial pressures as others, should they not receive the payment at the same time?” he asked.
The FCA's boss maintains that the FCA does offer "competitive pay".
Speaking at the Chartered Institute for Securities & Investment's 30th anniversary dinner in May, Rathi said: "We believe we offer what is possibly the best package among UK regulators, with competitive pay and strong rewards for consistent performance and greater opportunity for career mobility."
An FCA spokesperson said: "At the FCA we understand more than most the impact of the current cost of living pressures including on our colleagues.
"We have put in place support including a targeted one-off-payment in order to make the lives of some of our colleagues a little bit easier.
"We have already made changes to the way the payment will be made to part-time staff following direct feedback from colleagues."
ruby.hinchliffe@ft.com