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HRDs earn almost £25k less than FDs

Recent figures obtained from top executives across the UK show that finance directors earn significantly more than HR directors

UK HR directors earn almost £25,000 less than UK finance directors, according to figures obtained from recruitment companies HR Recruit and FD Recruit.

UK HR directors earn an average salary of £87,759, while UK finance directors earn an average salary of £112,077.

Phil Scott, managing director of HR Recruit and FD Recruit, told HR magazine that the findings suggest HR’s role is limited in some organisations. “While we’ve been seeing some improvement it’s clear that HR may need to take on a broader skillset to show its worth within some organisations," he said.

“A lot of finance directors take on other functions, whereas I don’t see as many people in HR taking on as many other disciplines outside of the sector. HR really has to push to be more commercial in an organisation.”

Scott acknowledged that HR can face challenges in proving the commercial worth of its activities: “HR [directors] are in a tough position as they’re constantly having to justify their plans to FDs through having to put numbers behind backing up their initiatives and demonstrate the value they can bring to a company. Sometimes it can be difficult to explain an initiative in pounds and pence.”

He added that the figures could also be attributed to the fact that many organisations' finance functions are much larger than their HR functions.

The data also found a gender pay gap within HR, with the average female HR director being paid £86,578 and the average male HR director being paid £3,269 more at £89,847.

Commenting on the gap, Scott said that it is difficult to dissect why it is so large. “It’s very clear that this worrying gap exists but we’re unclear of the extent at this point. While men are definitely being paid more it’s difficult to work out whether this is a coincidence,” he said.

"If we were to prove this further we’d have to look at a cross-section of sectors," he added, pointing out that "a male HRD within a large technology company will probably end up being paid quite a lot more than a female HRD within manufacturing” for example.

Around 130 HR directors and 1,000 finance directors were involved in this 2018 study.