Lloyds Banking Group’s Controversial Use of Staff Bank Account Data During Pay Negotiations
Lloyds Banking Group, a lending giant in the FTSE 100 index, is facing backlash for its use of staff bank account data during pay discussions in 2023 as reported by The Times. This controversial practice has attracted criticism from some unions and is under scrutiny by the Information Commissioner’s Office. In response to the concerns raised, Lloyds Chief Executive, Charlie Nunn, has acknowledged the need for an internal review.
What Prompted the Review?
The internal review comes after it was disclosed that Lloyds had used aggregated and anonymised employee account data during pay negotiations for the years 2026 and 2027. The banking group, which has a workforce of 64,000, encourages its employees to hold accounts with the bank. While the method of using employee account data for pay negotiations is legal, it has sparked concerns about privacy and data protection.
Unions’ Reaction to the Practice
Mark Brown, from the Affinity union which is not officially recognised by Lloyds, labelled the practice as “sinister, and smacks of Big Brother”. However, Nunn defended the practice, stating it was “a legal use case of using aggregated data for a relevant business outcome” and that “two recognised unions were very comfortable” with it. He admitted that further reflection was needed and assured that the lessons learned would be incorporated into future practices.
Outcome of the Pay Negotiations
The pay negotiations resulted in average salary increases for junior staff of between 7% and 9%. As part of an agreement with Accord and Unite unions, the minimum wage is set to rise to £27,400 by 2027. A spokesperson for Lloyds clarified that Nunn’s comments referred to an internal review rather than a formal investigation.
Lloyds Commitment to Fair Pay
In a statement, Lloyds reiterated its commitment to fair and progressive pay, focusing on providing certainty and support for all colleagues, especially the more junior ones. The bank expressed its satisfaction that members of its recognised unions had voted in favor of the competitive multi-year pay proposal for 2026 and 2027 by a significant majority.
Last week, Lloyds disclosed that Nunn received £7.4m in pay for 2025. Under proposed changes to executive pay policy, his remuneration could increase to £13.9m this year or £17.7m if certain performance targets are met. The group, which also owns Halifax and Bank of Scotland, is committed to maintaining a fair and progressive pay structure.
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