Persimmon boss could pocket £10m on top of £75m bonus after dismissal
Sacked Persimmon boss Jeff Fairburn could receive up to £10m in dividends over the next three years after being dismissed following a row over his £75m bonus.
The under-fire Fairburn was dismissed last week following mounting pressure from both investors and the public over his eye-watering pay packet.
Persimmon said that as Fairburn “left at the request of the company” and did not resign it could not claw back any of the share awards.
The shares have to be held until July 2021 before being cashed in but Fairburn could receive dividend payments of £9.9m in the meantime – if he exercises the rest of his share options by 31 December – on top of the £75m bonus.
In 2012 the FTSE 100 firm set up a long term incentive plan (LTIP), which gave bonuses based on awards of shares – with no cap on the shares.
Chairman Nicholas Wrigley and then-head of the remuneration committee Jonathan Davie resigned in December after realising the bonus scheme should have had a cap as shares soared from £4 at the scheme’s inception to £24.
Persimmon further attempted to calm the row by making Fairburn give back half of his shares reducing his bonus by £25m to £75m.
At the AGM 48.5 per cent of investors voted against the remuneration report in April. He narrowly survived after signalling his intent to donate a “substantial” amount of his award to charity.
But his dismissal came last week just weeks after a car crash TV interview in which he refused to answer questions about his bonus.
The UK's second largest housebuilder said that Fairburn's remuneration had been a distraction and that it continued to have “a negative impact on the reputation of the business and consequently on Jeff's ability to continue in his role”.
According to reports he turned down the chance to give back more of his bonus and keep his job.