Top directors' pay leapt 16% last year - further widening the gap between the boardroom and employees. A survey of the top 350 listed companies by research group Incomes Data Services says chief executives of FTSE 100 companies earned a basic salary of �625,000 last year. With incentives and bonuses their total pay jumped to �1.2m. The average basic pay of a chief executive from a mid 250 company was �351,000, rising to �583,337 after other incentive payouts.
"The result is that the pay gap between the boardroom and other employees has widened yet again," says the survey. Managers and professionals, say IDS, earn �135 for every �100 they earned in 1998. FTSE 350 directors earn �263 for every �100 they earned six years ago.
Incomes Data Services analysed the pay of 1,360 executive directors and calculated the total value of their salaries, bonuses, long-term incentive payments and notional gains made on share options.
Steve Tatton, editor of the IDS executive compensation review, said: "It looks as though remuneration commit tees are taking their cue from the famous American union leader Samuel Gompers. When asked what the labour movement wanted, Gompers is said to have simply replied, 'more'."
The report highlights a big rise in annual cash bonuses, which totalled 76% of FTSE 350 salaries, up from 64% a year earlier. There were fewer long-term incentive plan payouts and fewer share options were exercised.
The IDS survey underlines the findings of the Guardian's pay survey which showed the pay of FTSE 100 directors increasing by an average 13%.
The rises come despite institutional shareholders becoming more involved in remuneration policies and calls from the National Association of Pension Funds for firms to spell out the relationship between boardroom and shopfloor pay in their annual reports.
The survey says "very few remuneration committees make any reference to the relation of their latest recommendations to the policies adopted for the the rest of the workforce".
Mr Tatton said: "If the government hoped that more involvement by investors would dampen down boardroom excess then the expectation has turned out to be misplaced."
Julia Finch The Guardian