City firms should donate two-thirds of their bonus pots to charity rather than giving employees six-figure bonuses, cabinet minister Peter Hain says.
Peter Hain says huge bonuses increase social discontent
Massive bonuses - which totalled £8.8bn this Christmas - were fuelling envy and social discontent, the Northern Ireland Secretary told the Sunday Telegraph.
Mr Hain hinted firms could face new laws or tax hikes to reduce inequality if they failed to regulate themselves.
He said there could be a "big fight" if companies did not act responsibly.
"There's a real problem of people on average incomes feeling there's a sort of super-rich class right at the top," he told the newspaper.
"Four thousand City workers receiving more than £1m each in bonuses. People don't feel that's proportionate. We've lost a sense of moral corporate responsibility here.
"That sort of thing creates a society where you start getting envy being promoted and a sense of real antagonism and that breeds all sorts of socially undesirable behaviour."
Mr Hain, who is a candidate for Labour's vice-leadership, suggested two-thirds of the £8.8bn should be given to charity or inner-city regeneration projects.
"Let's work this out on the basis of consensus, let's not have a big fight over it, because it will come to a big fight otherwise," he said.