Variable Remuneration in the UK

Abstract

This article is a practical guide to the uses of variable remuneration in the UK. it sets out the various ways variable remuneration can be structured in the UK, considering cash bonuses and share plans and setting out the pros and cons of various tax– advantaged equity plans. it then moves on to discuss the use of variable remuneration in various markets in the UK, including discussion of FtSE 350 companies. The second half of this article then considers the regulation of variable remuneration, in the financial sector and in FtSE 350 companies, including the controversial «bonus cap». Finally, it touches on some legal issues surrounding variable remuneration in the UK, including the law around whether bonuses are contractual or discretionary, holiday pay issues, discrimination, new reporting requirements and issues around leavers and clawback.