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| The desk, sometime altar |
Philip Black, CEO of a top retail consortium, has earned a 50% pay rise this year, following ten years of similar annual pay rises, bringing his salary to £715,000, or £6.5 million including bonuses.
Other CEOs have praised his accomplishment, saying that Mr Black is one of the 'hardest working CEOs around', and his wife has said that he 'totally deserves it - he works like a navvy, poor thing'.
Philip Black first hit the 50% annual increase mark in 2000, as a reward for increasing the value of his company's shares by outsourcing half of the company's operations to India, where the salaries are a tenth of what they are in Europe.
The following year he received a 47% increase in his salary. While the increase in the value of shares was somewhat smaller than the previous year, the pay award came in recognition of his dedication to the job, as demonstrated by his availability to directors and clients at all hours of the day and night. "A middle manager is available only twelve hours a day," explained the renumeration committee, "So it is only fair that Mr Black, who is available 24 hours, be paid twenty times what they are paid."
In 2002 the company experienced a drop in share value but this was attributed to poor market conditions and Philip Black received a 49% pay rise as reward for moving his bed into his office so that he need not go home every night. This demonstrated a commitment unmatched except in the IT department, where top techies also habitually sleep in the office in order to increase their productivity and earn their £40,000 a year.
In 2003 Philip Black did 50% more work than in any previous year and forty times as much work as a low level manager in the company, or thirty times as many hours as one of his security guards. He was rewarded accordingly.
2004 was a dark year for Philip Black. His pay rise was only 31%, a mere 27 points above inflation. "Christmas that year was hard," he says, remembering the bad times. "I could barely look my wife in the eyes." But his wife stood by him. "Actually it was sweet," she said. "He was moping round the house like a lost puppy."
But 2005 turned things around for Mr Black, with a 54% pay rise. "There was no particular reason for that one," admitted a member of the renumeration committee. "Except that other CEOs were getting that too. In fact just to be safe we put it at 5% above what other CEOs were getting. I heard a lot of other companies were doing the same."
In 2006 Philip Black did not increase his personal productivity but the share price rose dramatically due to favourable market conditions. He received a 51% pay rise in recognition.
2007 was the year Philip Black became seriously dedicated to the job. "I remember thinking I'd better start justifying these pay rises," said Mr Black. "And since I was already working 18 hours a day and effectively on call for the rest of it, I began investigating the possibility of a time machine to make more hours in the day." But the time machine didn't work and Mr Black resorted to fitting a colostomy bag to himself so that he no longer needed to take toilet breaks. Everyone agreed that his 54% pay increase that year was richly deserved.
In 2008 Mr Black recognised that, while he had sacrificed his family life for his job, this was also true of many of his employees on £30,000 a year, many of whom he had asked to take a pay cut that year to help the company through the recession. It seemed he had to go further - fifty times further with bonuses taken into account - in order to justify his salary. Being unable to go any further by normal means, he hit on the idea of sacrificing not just his family life but his family. He killed his children on a makeshift altar in his office, burnt them and threw their charred corpses from a helicopter into the sea. "I still only got 49% that year though," he muses. "Funny how things work out isn't it?"
In 2009 Mr Black persuaded the company to provide a Lear jet for his private use. This shaved hours off his travelling time and earned him a 47% pay rise, taking his salary to 80 times that of an average employee in his company. "No one else showed such dedication in getting their travelling time down," said a friend. "The pay rise was inevitable really. It helped that they were worried he'd leave for another company of course. Because almost certainly no worthy replacement could have been found for a mere £530,000 a year plus a cap of £4 million on bonuses."
The 2010 pay rise of 51% is more of a puzzle, even to his wife. "It's true that last year he was doing 80 times as much as his average employee last year and 130 times as much as a toilet cleaner," she said, "but with the unemployment rate rising they all started working harder in fear of losing their jobs, so they kept pace with the him this year - for once." The surprise 51% pay rise was gratefully received by Mr Black. He awarded a 3% pay rise to most of his employees, 1% below inflation, and gave a rousing speech at the company annual conference exhorting his workers to 'give that little bit extra' to get the company through to the end of the recession.
Mr Black's pay rise for 2011 is as yet undecided. The renumeration committee is said to be considering a rise of around 50%, on the basis that 'he will almost definitely deserve it'.
For more on CEOs, see yesterday's link:
aboutlordbrowne.com
