Coronavirus: GVC bosses handed £5m share bonus while 14,000 staff furloughed

Yahoo Finance UK
The entrance to Ladbrokes Bookmakers in Regent Street, Swindon, UK. Photo: Getty
The entrance to Ladbrokes Bookmakers in Regent Street, Swindon, UK. Photo: Getty

Betting shop owner GVC (GVC.L) has awarded its top executives shares worth more than £3m ($3.8m) despite furloughing 14,000 staff.

The Ladbrokes Coral group, one of GVC’s subsidiaries, has handed chief executive Kenny Alexander shares worth £3.3m while chief financial officer Rob Wood has been rewarded with shares worth £1.4m. 

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GVC furloughed all staff at its 3,100 Ladbrokes and Coral betting shops in March but topped up the government funding so workers received a full wage. All of the outlets will reopen tomorrow.

The company, which has also benefitted from business rates relief, said it had saved £20m a month since receiving government aid.

Think tank High Pay Centre has condemned the share payout, calling on government to take action.

"For a company to be relying on public finances to pay its workers' wages, while handing out millions to its executives in bonuses flies in the face of what the general public expects from businesses at a time of national crisis. 

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"Perhaps now is the time for Government to make it clear that it will not tolerate such behaviour from companies using the scheme," think tank spokesman Andrew Speke told This is Money.

Firms have previously been warned about dishing out long-term share bonuses during the COVID-19 crisis.

In April, the Investment Association, which represents investment managers and asset management firms, urged pay committees to postpone granting long-term incentives if the share price was yet to recover. It also urged companies to cut the number of large payout shares.

GVC told This is Money: "We originally delayed the awarding of the LTIPs and the payment of the 2019 bonus due to the uncertainty created by COVID-19. However, the outlook for GVC is now more certain as a result of the gradual resumption of sport and the reopening of our retail estate next week. 

"The remuneration committee has therefore deemed it appropriate to pay the 2019 bonus and make the LTIP awards, which contain stretching performance conditions that have not been adjusted to take into account the impact of COVID-19."

Last month Morrisons (MRW.L) shareholders were been urged to vote against a generous executive pension payout by an advisory group.

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