British lender Barclays has introduced Role Based pay scheme to pay its highest paid staff members with extra allowances, in addition to their salaries and bonuses, to account for the upcoming European Union’s (EU) bonus cap rules.
Under the new rules, the EU will cap bonuses at 100% or salaries or 200%, if approved by majority of shareholders.
The role-based pay, which will be set at the beginning of the year, will depend on pay during the previous years, and bank’s forecasts and overall performance.
Role-based pay will not be linked to performance and will be paid in 12 instalments, claims the bank.
According to Barclays, since the role-based pay is given monthly and is based on the role of the staff member, it should not be covered by EU’s bonus cap.
Barclays investment banking head, Eric Bommensath, said the introduction of Role Based Pay allows the bank both to comply with the legislation and offer market competitive compensation to employees.