The FCA is to increase salaries by an average of 6.5% in April, with a guaranteed minimum increase for staff of 4.5%.

The increase will apply to Financial Conduct Authority staff and staff at sister organisation the Payment Systems Regulator.

FCA chief people officer Siobhán Sheridan outlined the offer in a letter this week to Unite union regional officer Steve O’Donnell.

Unite union members took part in a 48 hour walkout last May in a row over pay and terms at the FCA. In recent times Unite has accused the FCA of failing to raise salaries and improve terms for staff, resulting in an alleged exodus of staff.

Last year the FCA said it increased average salaries by 7.1% with some staff receiving a further increase. The FCA also made cost of living payments totalling £1,250 per staff members in the 2022/23 year.

In her letter, Ms Sheridan said that while she expected an “average base salary increase” in April 2023 of 6.5% across the FCA and PSR this would only apply to staff up to Senior Manager level with a ‘3’ or above end of year performance rating whose new salary is below £125,000.

Ms Sheridan said the regulator’s new employment offer was enabling it to make “meaningful” progress in narrowing gender and ethnicity pay gaps at the FCA.

In her letter Ms Sheridan also revealed a rapid rise in FCA headcount as it takes on a bigger workload, recently adding the regulation of funeral plans to its portfolio with crypto regulation on the cards.

FCA headcount on a full-time equivalent basis has grown from 3,878 at the end of March 2022 to approximately 4,352 at the end of January. During the past 12 months 1,136 staff joined the FCA in 2022 with 649 voluntary leavers.     

The watchdog is engaged in “large scale recruitment” at all levels across the UK, it said.

Ms Sheridan said she expects headcount to continue to grow this year with at least a further 150 new joiners expected before the end of this financial year in March 2023.

The FCA has also doubled headcount in its Edinburgh office and in the coming months expects to see its newly-established office in Leeds reach 100 colleagues.

Ms Sheridan said that changes introduced by the FCA encouraged greater internal mobility between divisions and roles. There were nearly 750 internal promotions in 2022 and she mentioned that salary rises resulting from promotions were not typically included in the average base pay increases quoted.

Unite and the FCA have been asked for comment on the letter.

Previously Unite has said it was unhappy about lack of consultation with the FCA over pay awards however the FCA says it has consulted widely with staff and unions.