Swiss voters headed to the polls yesterday for a referendum on whether to peg executive pay so that bosses cannot receive more than 12 times the salary of their lowest-paid employee.
The measure is not expected to pass. Only a third of voters in a recent poll said they would back it, down from closer to half last month.
The debate has tapped into a vein of discontent among Swiss voters, who in March overwhelmingly approved new rules to rein in golden handshakes, in the wake of mega-payments to top bosses.
Dubbed the “1:12” initiative after the legally binding ratio it would set between the top and bottom salaries in a firm, the plan has met with stiff opposition from Switzerland’s business community.
Its critics have issued stark warnings that inscribing salary restrictions into the law would make the nation less competitive and break with a Swiss tradition of a limited official meddling in business.
“There’s a climate of mistrust towards those who make money,” Jean-Claude Biver, boss of high-end watchmaker Hublot, told the Swiss daily Le Temps.
Christoph Darbellay, head of the Christian Democratic Party, said he could understand disquiet over “undeserved salaries.” However, voting yes would be tantamount of “shooting ourselves in the foot,” he said.
Switzerland’s cross-party government has urged a no vote, saying a 1:12 law would dent tax revenues and scare off foreign firms.
Switzerland has largely avoided the economic crisis dogging the EU, of which it is a staunch nonmember.
The referendum campaign was spearheaded by the Socialist Party, plus the Greens and trade unions.
They have rejected the criticism, arguing that it is time to clip the wings of the vastly overpaid, and underlining that an informal ratio of around 1:12 was the norm as late as 1998, before things went awry.
Under the direct democracy the campaigners were able to put the issue to a plebiscite by collecting more than 100,000 signatures.
The debate has led to intense scrutiny of bosses’ pay packets, which the 1:12 proponents say were an average 43 times higher in 2011 than those on the lowest incomes.
According to last year’s figures published by the campaigners, the then-boss of pharmaceutical giant Novartis made 219 times the lowest salary.
At banking group UBS, the lowest-paid employee would have had to work 194 years to make the same amount the head of its investment bank made in a year.
The chief executive of rival bank Credit Suisse had a ratio of 1:191.
At insurer Swiss Life — whose chief is also treasurer of the Economie Suisse trade and industry lobby — it was 1:60.
The campaigners plastered Switzerland with posters showing a single hamburger next to a towering stack of a dozen, reading: “12 times more salary, that’s enough.”