Barclays Increases Banker Bonus Limits in UK
- Barclays in the UK raises banker bonus limits to allow up to 10 times fixed salary in variable pay.
- Some members of staff will benefit from increased bonuses.
- This move may impact the banking sector and employee motivation.
Barclays has announced a significant change to its compensation structure, allowing top bankers outside the European Union (EU) to earn bonuses of up to ten times their base salary. This decision follows the removal of a cap on banker bonuses by financial regulators, a move made possible by the UK's departure from the EU, which freed UK banks from adhering to previous EU regulations. The bank's revised policy is expected to impact approximately 1,600 employees globally, classified as "material risk-takers." The new bonus cap represents a substantial increase from the previous limit, which allowed bonuses to reach only twice the fixed salary. Barclays aims to enhance its competitiveness in the financial sector by providing greater flexibility in setting individual bonuses within a defined group of high-performing staff. This change aligns Barclays with practices at other major investment banks, such as JP Morgan, as the bank seeks to attract and retain top talent in a competitive market. Despite the increased potential for bonuses, Barclays has clarified that the overall incentive pool, which determines the total amount available for performance-based pay, will remain tied to the bank's overall group performance. A spokesperson emphasized that the new cap will not alter expectations regarding total compensation for employees, and salaries will not be reduced as a result of this policy change. In a memo to staff, Barclays reassured employees that while the bonus structure is evolving, it will not automatically lead to increased total compensation, maintaining a focus on performance and competitiveness in the banking industry.