One of Britain’s biggest lenders has faced criticism for using information from the bank accounts of more than 30,000 of its employees as part of pay talks.
It emerged that Lloyds Banking Group assessed the saving and spending habits of its least well-paid staff members and compared this with the financial resilience of the general public as part of its pay negotiation process for 2026 and 2027.
This data was then shown to union officials during talks and, while the information was used on an aggregated and anonymised basis, it has spurred concerns among some that the lender used employees’ information inappropriately.
Staff are required to open an account with Lloyds when they are hired by the bank.
Mark Brown, the general secretary of Affinity, a union for Lloyds staff that is not recognised by the lender, told members that the bank’s actions, which were first reported by the Financial Times, were “sinister, and smacks of Big Brother”.
“[Lloyds] had no legitimate reason accessing staff accounts without permission. Doing it to justify its pay increase is not a legitimate reason,” he wrote in a newsletter to Affinity members, adding that it “will be for the information commissioner to determine whether Lloyds has committed a major data protection breach”.
“The fact that staff are also personal account holders doesn’t give the bank carte blanche to do what it wants.”
However, the bank insisted that no information about individual employees was seen or used during the process and that the exercise, which was conducted by the group’s so-called customer insights team, complied with data rules.
The FTSE 100 lender also rejected the claim made by Brown that Lloyds had used the data to justify “low pay increases” for staff.
The negotiations resulted in junior staff members receiving average pay rises of between 7 per cent and 9 per cent in a deal that has been approved by members of the Accord and Unite unions. The minimum starting salary for employees on the lowest grades will rise to £26,200 next year and increase to £27,400 in 2027.
A Lloyds spokesman said: “Aggregated, anonymised data was used at all times, in order to ensure compliance with regulations and to reflect common practice of using data to underpin decision-making.
“We are pleased that members of our recognised unions have voted to support our competitive multi-year pay proposal for 2026 and 2027 by a significant majority.
“We have worked hard with our unions, using the best available data and direct colleague input, to design a pay offer that gives our junior colleagues continued certainty and support, reflecting our ongoing commitment to fair and progressive pay.”
Since 2022, increases to base pay for Lloyds’s roughly 66,000 staff have amounted to more than £1.1 billion.
A spokesman for the Information Commissioner said: “We regularly engage with banks including Lloyds to advise on data protection issues. All organisations must consider both their legal obligations and their employee’s rights before they implement any monitoring in the workplace.”
Lloyds is Britain’s biggest domestic lender, which owns brands including Halifax, Bank of Scotland, MBNA and Scottish Widows. It is led by Charlie Nunn, its chief executive since 2021, who is most of the way through a £4 billion revamp of the business that involves digitising services, cutting costs and expanding its wealth management operations.
