Clifford Chance, NRF and Pinsents reveal partnership gender pay gap
29 March 2018
A handful of pioneering firms have reacted to criticism about a lack of transparency in other firms' gender pay gap reports
by including their partners in their statistics. But a lack of consensus on the best way to present the results means that the reports can't be compared in a like-for-like manner.
Under UK statutory requirements, firms are not required to include partners in their gender pay reports as they are categorised as business owners rather than employees. However, high-profile figures such as politician Nicky Morgan and Lloyd's of London CEO Inga Beale have slammed law firms for omitting partners. Other professional service industries, most recently the Big Four accountancy firms, reacted to the government, business and media pressure by releasing reports to include partners.
RollOnFriday understands firms have also come under pressure from their clients. Clifford Chance is one of a handful leading the charge to include partners. The Magic Circle firm has included partners in its figures, even though doing so has revealed an eye-watering overall pay gap of 66% in men's favour (on a mean basis). The firm explained in its report that the main reasons for the divide were that only 21% of partners in the UK were female, and that a high proportion of female staff occupied secretarial roles which made up a large proportion of the least well-remunerated jobs.
CC's UK Managing Partner Michael Bates told RollOnFriday that including partners figures in the results meant unveiling a larger gender pay gap figure than if the firm had just complied with statutory requirements. Bates said that it was the "right thing
" to do in order to demonstrate the firm's "commitment to closing the gap
" in the future. He called on the government to push for the inclusion of partner data, as well as on other firms to "demonstrate their commitment to addressing gender issues by adopting an equally transparent approach
Also leading the field (albeit in a different data format) Pinsent Masons and Norton Rose Fulbright produced reports to include partners. The two firms presented their findings differently to CC, opting to split their results between pay and bonus, rather than producing one definitive gender pay gap figure.
Pinsent Masons announced that for all staff, including partners, the firm had an overall mean pay gap of 58% and a mean bonus gap of 52% in favour of men. A spokeswoman for the firm said that it considered their approach to be "the most transparent and meaningful approach to the disclosure of partnership data
", although it recognised that other firms "may use alternative formulas for these calculations, which reinforces our call for a common method in order to establish a consistent formula
||"You 'avin a bleedin' laugh aintcha, trying to compare bleedin' apples with bleedin' oranges. Bleedin' law firms"
Adopting the same approach as Pinsent Masons, Norton Rose Fulbright produced a combined employee and partner figure to reveal an overall mean pay gap of 49% and a mean bonus pay gap of 61% in favour of men.
Irwin Mitchell and Reed Smith included partner stats in a different format again. In the least useful of the three approaches, they separated partners out from other staff, presenting an incomplete picture by failing to amalgamate partner and employee data.
Irwin Mitchell reported that amongst non-partners there was a mean gender pay gap of 12.8% and a mean gender bonus pay gap of 18%. Amongst equity partners, there was a mean gender pay gap of 8.5% and a mean gender bonus gap of 12%. And amongst fixed share partners there was a mean gender pay gap of 11.4% and a mean gender bonus gap of 12%. All, natch, in favour of men. Reed Smith revealed that for its staff (excluding partners) there was a mean gender pay gap of 14.8% and a mean gender bonus gap of 27%, while the partnership produced a mean gender pay gap of 0.83% and a mean gender bonus gap of 21.5%.
It remains to be seen whether other firms will now also include partner statistics. And if so, whether everyone can get their act together and do it in the same way so RollOnFriday doesn't have to make a table with a million asterisks.