Government to expose gender pay gulf in law

Topics: City,Equality and diversity,Government & politics

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The gender pay gulf at leading UK law firms will soon be laid bare following a change to mandatory reporting requirements proposed by the government.

Regulations set to take effect before April 2018 are now expected to include partner pay in the calculations which organisations employing over 250 people will be forced to disclose on their gender pay gap.

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It had been thought that partners (‘members’) in limited liability partnerships would be excluded, but a government clarification suggests this was an oversight.

Recent statistics show that only about 20% of partners at the top 20 UK law firms are women.

Karen Baxter, employment partner at Lewis Silkin, said: ‘Given the historic gender inequality at the highest levels of the profession, this is likely to have a significant negative impact on the gender pay gap figures that these firms will have to supply.’

The clarification comes in a Government Equalities Office (GEO) response to a request from Practical Law. It is not mentioned in the consultation document Mandatory Gender Pay Gap Reporting, published by the GEO on 12 February.

The clarification ‘significantly widens the scope of the draft regulations as originally understood by many, and means that, for example, LLP members and some self-employed contractors are likely to be treated as “relevant employees” for [reporting] purposes,’ Practical Law said.

Baxter added: 'If they do indeed expand the scope of the regulations in this way, it has very significant implications for firms which do not employ their staff in a separate services company (i.e. for firms where both employees and partners/members are engaged by the LLP). 

'For these firms, employees and partners will be added together to determine whether the 250 "employee" threshold is met, and partner pay would need to be included in the published information.’   

Baxter also pointed out that the final rules could be be amended to require aggregation of staff across subsidiaries. ‘This would significantly increase the number of law firms that would be covered by the rules,’ she said.

The equalities office said that a consultation on the draft regulations closes on Friday. 

Readers' comments (8)

  • Hmmm. Surely such statistics will be of very limited use unless the information gathered also includes some information about the diferent types of job being looked at? I would expect a solicitor to earn more than a cleaner, regardless of the gender of either, for instance.
    I think it is valid to try to look at the extent to which there are still gender gaps, and to try to better understand why this is, but it doesn't seem to me that the information which it is proposed will be collected, will necessarily help very much in achieving that aim.
    (Although as we employ fewer than 250 people we won't have to carry out this exercise just yet)

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  • I suspect that this requirement is going to be yet another brake on business growth at the top of the SME bracket. The so called gender pay gap is as a result of female lifestyle choices and there is some very interesting work done on this by Dr Catherine Hakim; she describes it as Preference Theory.
    Her paper is very easy to find.

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  • Any efforts to expose any true gender pay gap in the profession should be welcomed of course, so long as it is sensible and not as the post above suggests comparing partners to paralegals.

    Equally, I would welcome some insight into any pay gap as between ethnic groups and nationalities. Not for nothing, but I've seen and heard more of disparities between, for instance, Eastern European EU migrant workers in the profession and UK nationals at equivalent positions.

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  • When and where has this GEO statement appeared? This private clarification does not accord with the wording of the draft regulations published. So much for an open and transparent consultation process :(

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  • I honestly don't get it. It must go on, and women obviously are earning less for this story to appear. I just cannot understand why that would be though.

    If I employed a person - I would do so on merit, entirely regardless of their gender, and if they worked hard, bringing in clients and fees, I would reward them accordingly. If a fee earner was struggling - again regardless of gender, I'd have to deal with the situation appropriately.

    The same is true of race and sexual orientation - if the person you employ is good, why would any of this matter? I suppose that's the reason for the story in the first place...

    As one of the commenators says above - it's difficult perhaps to draw any conclusion unless you're truly drawing a like for like comparison, and that may be difficult to do in view of different firms structures.

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  • It'll be interesting to see how many all women firms and ghetto specialist female departments we get once gender equality in pay is enforced...

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  • Anon at 01.45pm....why ever would women solicitors shy away from gender equal pay....oh!

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  • All this gender equality talk will achieve is a drive down on salaries....not an increase in pay...it'll be as stupid as insisting on being allowed to participate in the workplace and then creating a situation where both of you have to work to earn what one of you earned in the first place....oh! .....Right...

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