PA’s Stephen Brooks, people management expert, is quoted in an article in the New York Times, on bankers’ bonuses. The article explains that banks operating in London are trying to find a way around Europe’s bonus restrictions and that banks are structuring new pay packages.
The article states that the new bonus-cap law, which applies to European banks and European operations of global banks will force them to pay more in annual salary. Stephen comments: “It makes London less competitive against the U.S. and Singapore and anywhere outside the E.U. That’s a disadvantage to the E.U.”
Stephen continues by explaining that for the moment, the banks in London have an ally in the British government, which is suing to block the law, saying that the European Commission has overstepped its authority. According to Stephen, banker compensation is important to the British government, which gets 60 cents of every bonus dollar in the form of taxes and national insurance.
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