City firms’ exclusion of partners from gender pay gap reporting draws criticism

Several firms have moved to defend themselves from accusations that their gender pay gap reporting has been rendered meaningless because the reports exclude data on partners.

All businesses with 250 or more employees are now required to release data about their gender pay gaps. However, the Law Gazette reports that many firms are excluding equity partners from their pay gap reporting on the grounds that partners are not employees.

Inga Beale, the chief executive of Lloyd’s of London, has criticised the move as a “carve out” for a male-dominated group of senior high earners (over 70% of partners are male at most top City firms).

Meanwhile Tony Williams, principal of legal consultancy Jomati and a former magic circle partner, defended the firms’ policy: “As a partner, you are a proprietor and cannot be considered in the same light as an employee. Although remuneration can be very high you have to be prepared that it could also fall significantly.”

See this Commercial Question to learn more about the gender pay gap and what it means for businesses and employees.

And this Feature explains the difference between equity and salaried partners, and the various ways that firms structure themselves.