Bonus payments up nearly 5% in past year

Published:

The total bonus payments received by UK employees increased by 4.9% in the 12 months to April 2014, figures released by the Office for National Statistics (ONS) reveal.

The payments reached £40.5 billion in 2014, accounting for 6% of total pay awarded by companies over the 12 month period. The average bonus awarded per employee was £1,500,an annual increase of 2.6%.

Bonus awards in the financial sector remain by far the highest despite not increasing as quickly as other areas. Employers in the industry awarded £14.4 billion (up 2.9% over the year) to their employees from May 2013 to April 2013, compared to £26.1 billion (up 6.1%) for all sectors combined.

The private sector saw bonus awards increase by 5.8% to £39.1 billion in 2013/14 while they fell by 16.3% to £1.3 billion in the public sector. This is largely due to the privatisation of the Royal Mail and the subsequent reclassification of its employees.

ONS statistician David Freeman told HR magazine the figures are a sign that companies are more willing to "loosen the purse strings" during the recovery.

"Bonuses took a real hit during and after the downturn but now they're starting to get back to 2008 levels," he said. "Even in the financial sector where growth is slower they remain a very important part of people's pay packets."

Freeman added that the cap on bankers' bonuses has not been seen to have any effect on overall awards.

"It's important to note that it will only affect a small number of people who earn enough to trigger it," he said. "But we've not seen anything yet to show that it's taking hold in the City."