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Women in the City are suffering “shocking” pay discrimination because of the macho and long hours working culture in their offices, an
official report warned today.
The study, by the Government's Equality and Human Rights Commission, says the women employees also lose out particularly badly in financial firms if they have children and want to balance their work and family lives.
The result is an average 39 per cent gap between the basic pay of men and women - which rises to 47 per cent when total earnings are taken into account - and a “startling” 80 per cent in the size of bonus payments.
The findings of the report, which was commissioned by Equality Minister Harriet Harman, will fuel renewed concern about the treatment
of women in the City despite the increasing efforts by some firms to combat discrimination.
Unveiling the conclusions today, Trevor Phillips, the chairman of the Equality and Human Rights Commission, warned that unless firms tackled the problem Britain's prospects of economic recovery would be harmed and said that further action would now be taken to force improvements.
“The financial sector has the potential to play a central role in Britain's recovery. But it has to address this shocking disparity of rewards,” Mr Phillips added.
“For business to thrive in the new economy it simply can't afford to recruit and reward in the way it has done in the past.
“By bringing down arbitrary barriers, and changing practices that, intentionally or not, inhibit women's success, financial firms have the chance to boost morale, bring on new talent, and maximise the potential of their existing employees.”
Today's report, which is based on evidence from 44 financial firms employing around 300,000 people, says that one of the biggest problems “blocking women's success” is the “unusually high proportion” of workers in the sector who are in the 25-39 age group.
It says that this is the age when many women have childcare responsibilities and suggests that those who seek to balance their work
and family lives, either by curbing their hours or taking time off, often lose out permanently.
Among the factors it cites that contribute to this are the “macho” and “long hours” culture prevalent in many offices - reflected in after hours drinking, trips to lap dancing clubs and other male-orientated networking activities - which women, particularly those with families, can be reluctant to engage in.
The report says that stereotyping in recruitment, with employers often hiring those whose “face fits”, further distorts pay levels and quotes figures gleaned from its research to support its conclusions.
These show that the annual basic earnings of women in the financial sector average £22,622, compared to £38,604 for men - giving a pay gap of 39 per cent.
The pay gap in bonuses is even wider, however, at 80 per cent, with women receiving an average £2,875 a year and men getting £14,554.
That means that total pay of women in the finance sector averages at £27,744, compared to £52, 743 for men, leaving the typical female
employee 47 per cent worse off overall.
Although today's report concedes that some of the difference is the result of men occupying more higher status and higher earning posts
than women, it also warns that a pay gap exists even within for employees within the same job category or grade.
The report calls for companies to publish equal pay audits to combat the problem and to provide effective parental support schemes to help those with children.
It also recommends that firms appoint a board member to promote equality.
Reader views (16)
Complaining because they don't get as much money when they don't put as much into the job (for whatever reason)? That's the argument?
Bad luck ladies - that's what happens in real life. Harman's known propensity for putting men in their place (under her thumb) aside, how else can it possibly work? Should the men work less so that the money is 'equalised'? Or should they follow the socialist dream and work harder then share the profits with those who are not working harder at the job?
By the way - someone has to take care of the kids that THEY CHOSE TO HAVE. Who does it is up to the parents - but it is a price and a responsibilities that goes with the job of parenting. Live with it.
- Rogan, Irving
The report, instigated by Ms Harperson and chaired by Trevor Phillips should be immediately dumped into the nearest skip. Ms Harperson is well known for her anti male stance on everything from the number of male MPs in the Commons to changing the law to make it 'easier' to convict men following allegations of rape, even after the recent spate of court cases where female complainants have been convicted for wasting police time and perverting the course of justice by making false allegations of rape against their former lovers. Phillips, on the other hand, should not even be the Chair of the EHRC. He was appointed to soften the blow of not being selected as the official Labour candidate for the original London Mayoral elections. His performance as Chair of the EHRC is dismal, and has resulted in a significant number of highly experienced and competent Commissioners, both male and female, resigning over allegations about his lack of management skills and dictatorial approach to dealing with people.
- Paddy, Croydon Uk
"The findings of the report, which was commissioned by Equality Minister Harriet Harman" - That's as far as I read in this story and all I need to know about its content and the motives of those behind it.
Roll on the general election!
- Keith Lonsdale, Doncaster
I see it doesn't mention the thousands of women who work in the City as Support Staff: they definitely get paid less, no bonus, can't afford the childcare and have a hard job juggling family commitments - and are then treated like Thickos by career women!
There was a study into this a couple of years ago which showed men are much more pushy about negotiating pay-rises: thus a man and a women who start out on the same salaries wind up 10 years later on completely different ones. I guess ultimately you get paid what you think you are worth: support-staff accept less pay but with hours that fit better with family time - like all choices in life, it is a trade-off against what is more important to you.
Wider British attitudes to women are at play: raising children is not considered a proper 'job' unless it is done by a paid nanny or creche, and older women have no perceived value either. Back in Ye Olden Days when mortgages were only based on one salary per property, it wasn't necessary for women to juggle full-time employment with motherhood. Were it not for ageism, women should be able to have a child and then a career. Macho British working practices discriminate just as much against men who would prefer to be at home reading their children a bedtime story. When I first came to France I thought their 35hr working week was crazy: but combined with an average commuting time of 10 minutes, they have fewer material posessions and more quality family-time.
- Roz, France
I became an investment banker after an earlier career as a financial journalist. I was incredibly impressed by how meritocractic the City was compared to journalism (both were public companies).
1) Gender aside, if you were not public school educated in the media company, forget it. Mewnwhile, no one took any notice of accents or background in the bank (at least in my part of the bank).
2) It wasn't just class - both women and ethnic minorities were better represented at the bank. Having said this, posh women were much better represented in the media. They were also the demographic most bigoted in favour of themselves of any in my working experience (barely hiding their contempt for "chippy oiks" or "Essex girls").
3) Both the bank and the media company lacked very senior female representatives - i.e. board level. The further up you went, the more male and white both organisations became. Yet the bank seemed more concerned about this than the media company (and now has a female board member). The media company's board seemed impenentrable for anyone other than posh Oxbridge men who were mates of the chairman.
- Milton Not Keynes, London
Anyone who works in the city (assuming they can do basic mathes) knows that the word "average" hides a multitude of possibilities. The "average" man in this country earns £22,000, the average woman at goldman sachs earns £300,000. Does that mean all the men are underpaid? This is more grandstanding by a useless quango who on avergae do nothing to improve the lives of the average person in this country. ie not of a minority.
- Jon, london
How will this save Trevor Phillips' job for him?
- Jamal Akhbar, Edinburgh
it is the pay gap between the City and the rest of the country that is the main concern
- Keith Price, Luton England
Anything to do with H Harperson and you know it stinks to high heaven. Anyone who works in the financial city knows this is not true. I worked for an investment bank and female colleagues were paid as equal and treated as equals. Some where high ranking and so deservedly so on merit.
Good on Kate (London) and Hansel (London).
- Asw, HK
In a service industry when entertaining you go where the client wants to go, If the client wants to go to a lap dancing club you go there, if the client wants to go and see The Chippendales you go there. People like Sir Trevor and Co need to look behind the headlines if this situation is to be addressed.
- Jim, London
A friend of mine is both a high ranking executive in a multi-national and a mother. She works the normal long hours associated with such jobs. Her husband stays at home to look after the kids and house.
- Dave, London
"It (The Report) also recommends that firms appoint a board member to promote equality."
Do I hear the sound of squeaking rats trying to gain themselves a well-appointed job on a board somewhere? Well on past performance, Harman and Phillips could never fit onto a PLC board by trying to bully any business into employing them and it would will never fit with shareholders who must agree to employ them
Trevor Phillips background does not stand the scrutiny that a report like this would appear to justify, he is a flawed character with flawed credentials
- Donovan, London
Call me old in my ways, but employers want commitment, which may sometimes go beyond the working day.
Women often want it both ways.....flexible working hours and equality. Fair enough but don't expect the same renumeration. I as a man see you as equal but don't push it. And it is interesting that 2 replies are from women who rubbish this report. Good on you.
- Rod, Epping, UK
I am all for equal pay for men and women but it is logical that those that put more after-hours work into their jobs will be rewarded, otherwise what would be the point of doing the extra work. It is unfortunate that the current structure of society dictates that the majority of mothers are the gender that are responsible for child-care but it would be quite as easy for the fathers to be responsible for this. As an employer in the city myself, I am much more likely to reward someone who will go that extra mile whether they are male or female, but I must admit that women, in my experience, generally do less hours than men. This is just an observation.
- Donald D, London, UK
My wife has been working in HR in the City for years and stated quite categorically this morning that this report is nonsense. Now one in the industry knows where the commission got the information but it wasn't from the industry.
I'm suprised the ES has played along with such a politically motivated report, which predictably plays along with the current 'anti banker' sentiment,.
- Hansel, London
This report is utter garbage. It does not compare like with like, mangles statistics to get its pre-determined conclusions, and reinforces outdated stereotypes about the workplace.
Look at the authors; the incompetent man-hater Harriet Harman who is due to join the dole queue next year, and Trevor Phillips, under siege to save his job and justify the lousy way he runs this quango.
- Kate, London
