TSB staff are to be handed free shares worth £100 as part of a John Lewis-style reward scheme unveiled by the challenger bank yesterday.
As newly-created TSB Partners, 8,600 employees from the chief executive to front-line branch workers will also be in line for an annual performance-related award that could pay a maximum 15 per cent of salary. The bank, which is returning to the stock market this month as part of a 25 per cent sell-off by Lloyds Banking Group, said it wants to encourage a sense of shared ownership and safeguard levels of customer service. TSB reviewed the policies of other banks and drew inspiration from a range of retail businesses, most notably John Lewis Partnership.
For the annual award to be paid, the bank and its staff must achieve customer service metrics and the group itself must be profitable. A second scheme has been set up that will deliver cash and shares to its executive team over five years to a maximum of 100 per cent of salary.
Chief executive Paul Pester, whose basic salary will increase from £600,000 to £700,000 a year, will be entitled to a maximum potential award of £1.68m – the equivalent to 65 times the current average pay of non-managerial TSB staff.
It means that TSB will comply with the European Union guidance that bonuses must not exceed salary, unless otherwise approved by investors.