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The Restaurant Group boss Hornby in storm over pay boost.

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the restaurant group boss hornby in storm over pay boost
Ex-banker Andy Hornby is embroiled in a new pay row at The Restaurant Group

Ex-banker Andy Hornby is embroiled in a new pay row at The Restaurant Group

Ex-banker Andy Hornby is embroiled in a new pay row at The Restaurant Group over plans to hand him a huge shares windfall after thousands of staff lost their jobs.

Hornby, the former HBOS chief executive who now runs Wagamama and Frankie & Benny’s, waived his bonus for 2019 and took a pay cut as the group battled to survive the pandemic.

But on Thursday The Restaurant Group will ask shareholders to approve a new executive pay scheme that would give him a fixed annual payout on top of his £630,000 base salary.

If the plan is approved, Hornby will be handed a potential £787,500 share award for this year – taking the chief executive’s total maximum pay packet for 2020 to £1.3million.

From 2021, his £945,000 cash bonus would be reintroduced alongside a £630,000 share award, taking his maximum potential remuneration to £2.2million.

The vote on the pay deal comes amid a crisis for the hospitality industry, with forecasts that up to a million more jobs could be lost this winter.

The Restaurant Group has made 4,500 staff redundant during the pandemic and has closed about 250 of its 650 pubs and restaurants.

Shadow Business Minister Lucy Powell said: ‘Business owners are being put in an impossible position during this crisis by the failure of government to adequately support sectors like hospitality in deep distress, but this will be a kick in the teeth to the thousands of workers in The Restaurant Group who have been laid off.

‘Ministers must redouble their efforts to get excessive pay under control and make sure workers don’t pay the highest price.’

Andrew Speke, of the High Pay Centre pressure group, said: ‘Companies have a moral responsibility to protect workers’ jobs over their top bosses’ bonuses.

‘To make thousands of workers redundant and still award the chief executive a bonus large enough to have saved dozens of jobs is completely unacceptable.’

Glass Lewis, an influential shareholder advisory group, said it has ‘severe reservations’ regarding the 2020 pay deal ‘given the continued shareholder and wide workforce experience and in light of the company’s share price’.

It said: ‘The company announced that it anticipates that there will be a slow recovery in footfall during the rest of the financial year … which will have a material impact on the company.’

The Restaurant Group said Hornby’s £787,500 share award for 2020 will become available to him in three years’ time, and that half that sum is subject to hitting performance targets.

The Restaurant Group, which owns Frankie and Benny's, has made 4,500 staff redundant during the pandemic

The Restaurant Group, which owns Frankie and Benny’s, has made 4,500 staff redundant during the pandemic

A spokesman said: ‘Management have taken voluntary executive pay cuts of up to 40 per cent and waived bonuses that were approved pre-Covid. This is a long-term scheme and no payout can be made within the next three years. In the short-term the senior team continue to take voluntary pay cuts.’

Hornby’s appointment as chief executive of The Restaurant Group is his first job leading a public company since he ran HBOS, which he left after its taxpayer-backed bailout during the financial crisis.

He then ran chemist Alliance Boots, leaving in 2011 with a £2.4million payoff, followed by gambling giant GVC Holdings, where his salary was undisclosed because he did not take a seat on the board. Hornby joined The Restaurant Group in August last year.

On Tuesday, the group will announce half-year results for the six months to June.

This post first appeared on dailymail.co.uk

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Coronavirus curbs could force BA owner IAG to raise more cash

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coronavirus curbs could force ba owner iag to raise more cash

British Airways-owner IAG warned it could need to raise even more cash if there are prolonged, sweeping lockdowns after it posted a mammoth £5.6billion loss. 

The airlines group has already secured £2.5billion funding from shareholders and hundreds of millions of pounds from governments after the pandemic led to mass flight cancellations – which are still failing to recover. 

Suffering: IAG lost the equivalent of £900,000 an hour during the first nine months of the year

Suffering: IAG lost the equivalent of £900,000 an hour during the first nine months of the year

Suffering: IAG lost the equivalent of £900,000 an hour during the first nine months of the year

Yesterday IAG, which also owns Ireland’s Aer Lingus and Spain’s Iberia, admitted the Covid crisis could be even worse than its grimmest forecasts. 

If that was the case, the company would ‘likely need to secure additional funding’, it said. 

IAG lost the equivalent of £900,000 an hour during the first nine months of the year as it took a slew of one-off charges in addition to a revenue hit from fewer flights. Passenger numbers fell by 78.6 per cent between July and September, when many tried to squeeze in last-minute summer holidays. 

But IAG has warned that this winter it will only run about 30 per cent of the flights it operated last year. 

Chief executive Luis Gallego, who took over at the FTSE100-listed group last month, is overseeing a wide-ranging shake-up that includes shedding thousands of jobs – including up to 13,000 at BA. 

Yesterday Gallego said the company has already managed to slash costs by 54 per cent. 

This helped send shares up 5.9 per cent, or 5.36p, to 96.44p by the close. 

But Gallego pleaded with ministers to set up an airport coronavirus testing programme – warning that having ‘reliable and affordable’ tests would be the best way to help the business recover. 

He said ‘volatile government restrictions’, such as introducing last-minute quarantines on travellers returning from certain areas, was making it too difficult for passengers to book flights.     

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Britain braces for new tsunami of job losses

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britain braces for new tsunami of job losses

Major companies have culled nearly 200,000 British jobs already as they struggle with the devastating impact of the coronavirus pandemic, a Mail audit has found. 

As shops and eateries face growing curbs, and international travel is hit by a collapse in demand, leading firms from Marks & Spencer and British Airways to Rolls-Royce and Debenhams have slashed around 183,900 roles across the UK this year. 

But experts and business leaders warned this is just the tip of the iceberg – far worse is to come as fresh Covid-19 lockdowns slam the brakes on the economic recovery. 

Challenging times: Rishi Sunak's furlough scheme is being replaced by a slimmer jobs support scheme

Challenging times: Rishi Sunak's furlough scheme is being replaced by a slimmer jobs support scheme

Challenging times: Rishi Sunak’s furlough scheme is being replaced by a slimmer jobs support scheme

The Government’s furlough scheme – which supported 9m jobs at its height – comes to an end today and will be replaced by a slimmer jobs support scheme. 

Employers have warned it will not be enough to stave off more redundancies if restrictions tighten further, as businesses face tumbling visitor numbers or being forced to close altogether. Unemployment has already risen to a three-year high of 4.5 per cent, with the Bank of England predicting it could rise to 7.5 per cent by the year’s end, potentially leaving 2.6m out of work. 

And this week the Resolution Foundation estimated the UK is facing the highest level of youth unemployment since the 1980s, after a survey found 20 per cent of 18 to 24-year-olds could soon be jobless. 

In a fresh warning yesterday, the Federation of Small Businesses (FSB) called on ministers to make sure that firms ‘have the support they need to make it through the next few months’. 

Mike Cherry, the group’s national chair, said: ‘With new restrictions being imposed in every part of the country, many of which are set to get tighter in the weeks to come, small businesses face huge difficulties over the winter months ahead. 

‘Our latest small business index found that 30 per cent of employers expect to make some staff redundant in the next three months. 

‘That is the scale of concern and uncertainty that small firms are faced with for their businesses, with many letting staff go for the very first time.’ 

Pubs have warned that lifeline grants promised by Chancellor Rishi Sunak will not reach them unless state aid rules are changed – putting 1m jobs at risk. The British Beer & Pub Association, British Institute of Innkeeping and UK Hospitality warned that with – out action some 20,000 venues in areas hit by Tier Two and Three lockdowns will be starved of the desperately-needed cash. They said: ‘If action is not taken, thousands of businesses might not survive to the spring.’ Jobs at other leisure sector businesses, such as nightclubs, have also taken a sharp hit. 

35058784 8898613 image a 136 1604094527983

35058784 8898613 image a 136 1604094527983

The UK’s largest nightclub owner, The Deltic Group, had already cut around half its staff before it put itself up for sale yesterday. The Treasury has insisted that its jobs support scheme and job retention bonus – awarded to firms for keeping on staff who were previously furloughed – will together cover 95 per cent of total wage costs for the average furloughed employee until February. 

Around 9.6m people used the furlough scheme in total, though the most at any one time was 8.9m. Sunak said the programme had supported ‘9.6m jobs through some of the most challenging economic times’. 

But he added: ‘It’s right that as we move towards a more targeted approach to tackle the virus, our support becomes more targeted too. The jobs support scheme will continue to protect jobs through – out the difficult months ahead and is part of our comprehensive plan for jobs.’

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Freddie’s Flowers raises £3.7m in four weeks

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freddies flowers raises 3 7m in four weeks

Flower delivery group Freddie’s Flowers has raised £3.7m from customers and new investors in four weeks to ramp up its online expansion. 

The company launched its first ‘flower bond’ on October 5. 

The funding round closes on November 17, and the group has already surpassed its initial target to raise £2m. It is hoping to bag up to £10m.

Blooming: Founder Freddie Garland wants to double the size of the business ¿ which has seen sales rocket to £26m ¿ by 2022

Blooming: Founder Freddie Garland wants to double the size of the business ¿ which has seen sales rocket to £26m ¿ by 2022

Blooming: Founder Freddie Garland wants to double the size of the business – which has seen sales rocket to £26m – by 2022

Freddie’s Flowers has been a rare success story during the pandemic and has seen the number of subscribers to its weekly delivery service rise from 60,000 to more than 100,000. 

Founded by Freddie Garland, 32, from a gazebo in his parent’s back garden in 2014, it delivers 40,000 boxes of flowers per week. 

Garland wants to double the size of the business – which has seen sales rocket to £26m – by 2022. The four-year flower bond offers backers twice-yearly cash payments worth 5 per cent of their investment – or regular boxes of flowers worth 7.5 per cent. 

Investors must put at least £2,500 into the bond. Last week it launched its first international business, in Germany.

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