Free parking, club memberships and first-class travel were among a slew of executive perks cut out last year by international companies in Bermuda.Executive pay came under pressure across the financial services sector as profit margins were squeezed in the challenging global economy, PricewaterhouseCoopers’ (PwC) annual Bermuda International Business Compensation Survey showed.With smaller or no pay increases, average compensation rose only modestly, by five percent in 2011, compared to 12 percent in 2010. Some positions in the re/insurance, investment and banking world even saw cuts, the PWC Bermuda survey showed. However, pay for back office jobs generally increased.The survey found the largest cutbacks in executive extras were experienced in gym, golf, tennis, and yacht club memberships, which were provided by 44 percent of respondents in 2011, which was down significantly from 64 percent in 2010, while free parking was only covered by 36 percent of companies in the survey, down from 53 percent in 2010.Allowances for first class air travel among executives were also down, to 24 percent last year from 36 percent the year before.“The Bermuda financial services sector is feeling the chilling effects of uncertainty in the global financial markets and declining investment conditions,” said Alistair McNeish, managing director of PwC’s Human Capital Consulting group.”Not surprisingly, and in line with other global financial centres, profit margins across Bermuda’s sector have been eroded, creating a knock-on effect for the remuneration of employees at all levels.”The PWC survey of 55 Bermuda employers shows that some roles among the Island’s biggest employers, in insurance and reinsurance, actually saw lower compensation levels.For example, compensation for senior modellers at participating insurers fell by an average of 28 percent while the roles of chief underwriters and underwriters also experienced reductions of 14 percent and 21 percent, respectively.The sector’s executive level positions mostly escaped serious pay cuts, except for those at smaller insurers and reinsurers (fewer than 100 employees), according to the survey.“However, there has been little movement in base salaries among this group for the last few years,” Mr McNeish said. “In many cases, where financial services companies reduced or capped salaries, bonuses and long term incentive plans were maintained across these roles.”In comparison with executive positions, traditional “back office” jobs such as systems analysis, compliance and accounting, were proving to be the more resilient within financial services, with salaries and total compensation continuing to trend upwards, the survey found.In addition to the negative effects on compensation resulting from the downturn, the report cites a number of possible other explanations for smaller increases in compensation- including replacement hiring of individuals at a lower level skill or salary making the top of the list.Strategic restructuring and relocation of roles to other jurisdictions has likely contributed to the drop, and softer negotiating by new and existing employees in a competitive job market may also be adding to the trend, the survey said.“Bermuda has long been viewed as a place where you can earn significant rewards when times are good,” Mr McNeish said. “And although the Island doesn’t appear to be impacted by the downturn any more than other global centres like London and New York, the economic situation remains challenging for businesses.“As a result, employers in the financial services sector are clearly reviewing how they balance tighter budgets while ensuring they are able to hold on to their most important assets: their best people.“Bermuda companies that do not take account of these internal and external factors when balancing their compensation strategy risk putting themselves at a competitive disadvantage, locally and internationally.”