HUNDREDS of Barclays’ highest paid staff are in line for extra payments to top up their salaries and replace the income lost by the EU’s incoming bonus cap, the bank has told workers.
The level of the monthly payment, known as Role Based Pay according to an email to staff seen by City A.M., will depend on pay in previous years as well as forecasts of the bank’s performance overall.
The EU wants to cap bonuses at the same level as salaries for code staff – senior, risk-taking employees, numbering 393 at Barclays last year.
Barclays believes that as the pay is given monthly, is not awarded retrospectively and because it is based on the role of the staff member and the performance of the bank overall, it should not be covered by the EU’s cap on bonuses.
The bank also hopes that setting the pay annually makes it more flexible than salaries, allowing it to reflect profits each year.
“The introduction of Role Based Pay allows Barclays both to comply with the legislation and offer market competitive compensation to employees,” said the email, from investment banking head Eric Bommensath.
The note the scheme has been run past regulators and big shareholders. The Bank of England’s prudential regulation authority is known to be opposed to the bonus cap.
Its boss Andrew Bailey has spoken about the harm the cap could do, forcing banks to drive up salaries to compensate for lower bonuses, making their costs less flexible in times of crisis.