Pressure is mounting on magic circle firms to include high-drawing partners in their reports of gender pay gaps after their counterparts in the accountancy field began publishing such figures.
Three of the ‘big four’ accountancy firms: KPMG, EY and Deloitte, have all published updated statistics after City leaders pointed out that omitting high-paid, mainly male, partners would show an unrealistically small gap between the earnings of men and women. PwC said it intends to follow suit in the coming days.
Inga Beale, chief executive of Lloyd’s of London, said last month that excluding partners provided a ‘carve-out’ for a senior, highly-paid, mainly male group. Speaking in a personal capacity, Law Society vice-president Christina Blacklaws also said last week that she would welcome the inclusion. However magic circle firms have so far resisted the call on the grounds that the legislation requiring gender pay gaps to be reported by 4 April refers only to employees.
Equity partners at top firms can earn in excess of £1 million every year, A high percentage of the partnership – in most cases more than 70% – is male.
Updated figures from accountancy firms back the claim that including partners in the statistics dramatically increases the gap between men’s and women’s earnings. KPMG is now reporting a 27% median and 42% mean pay gap between the firm’s male and female staff. Previously, with partners excluded, the median gap was 22.1% and the mean 22%.
At EY, the median gap was first reported as 14.8% with the mean at 19.7%. With partners included this has risen to 19.5% (median) and 38.1% (mean).
Deloitte, taking into account total gender earnings including salary and bonus of employees compared with total equity partner earnings, said there is a mean gap of 43.2% and a median of 15.2%. The mean salary pay gap for employees, with equity partners excluded, was reported at 18.2%.
None of the five magic circle firms approached by the Gazette has shown any sign of emulating the accountants.
The Equality Act 2010 (Gender Pay Gap Information) Regulations 2017 requires businesses with 250 or more employees to report specific figures about their gender pay gaps by 4 April. The Government Equalities Office declined to comment on whether it is considering broadening the reporting requirement to include equity partners.