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City law firms reveal latest pay gap figures

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Clifford Chance, Hogan Lovells, Clyde & Co and Irwin Mitchell go public with gender and ethnicity results

A number of law firms have gone public with their latest gender and ethnicity pay gap figures, revealing results largely unchanged compared to the previous year.

Magic circle titan Clifford Chance‘s overall gender pay gap (the difference in average hourly pay for women compared to men) has narrowed slightly, from 65.7% to 63.5%, while its partner pay gap now sits at 25.7%, down from 27.5% the previous year. The gender pay gap among associates is 5.5%.

The new report also shows CC’s overall ethnicity and LGBT pay gaps, including partners, stand at 47.5% and 24.7% respectively.

Introduced by the government in 2017, all companies, including law firms, with more than 250 employees are required to report annually on their gender pay gap. Reporting on ethnicity pay gaps is not mandatory.

Commenting on the results, CC’s UK managing partner, Michael Bates, said:

“While our pay gap data shows that we are moving in the right direction, this progress remains slower than we would like, and we have more to do to realise our global inclusion strategy to change the rules, change the culture, change the lived experience.”

Meanwhile, Hogan Lovells confirmed an overall gender pay gap of 56%, down from 57.8% the previous year, while its pay gap for employees, so excluding partners, is 31.7% The firm’s ethnicity pay gap sits at 9.5%.

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Elsewhere, Clyde & Co reported an overall gender pay gap has increased slightly to 57.5%, while its partner gender pay gap has been slashed from 45.5% to 27.7% on the previous year. The firm’s ethnicity pay gap sits at a little under 30%.

Irwin Mitchell has also gone public with its latest pay gap figures, recording a 1.2% reduction in its gender pay gap, from 10.3% to 9.1%. The outfit’s ethnicity pay gap widened by 5.9%, from -2.3% in 2019 to -8.2% in 2020.

Susana Berlevy, Irwin Mitchell’s chief people officer and chair of IM diversity doard, said: “We’re delighted to report that our mean gender pay gap continues to move in a positive direction. There is still work to do, but we are making strong, tangible progress due to a real commitment to diversity and inclusion and the relentless focus and passion of IM Diversity Networks Leads.”

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17 Comments

Anonymous

The pay gap is not due to gender, but to people being paid different rates for doing different jobs.

(123)(24)

Joe

11 likes in less than 10 minutes?

Yeah you spam liked your own comment

(14)(39)

Ed

You really think we wouldn’t notice you liking your own comment multiple times

(8)(21)

Rupert

Spam spam spam your like button
Gently down the stream
Merrily merrily merrily merrily
Life is but a dream

(9)(12)

Karl

There are literally women doing the same jobs getting paid less.

Your comment says more about you than anything else.

(23)(51)

Marx

Actually it says more about you.

These pay gap figures are nothing to do with people doing the same job.

(22)(7)

Emily

Ignorant Swine!!!!!

(7)(6)

Mitch Patent

Pay gap is leftist speak for “results must be equal even when effort and ability is not.” It stems from the fiction that these so-called gaps derive from unlawful discrimination, which is demonstrably false.

(4)(0)

Mollie

This might sound naive but why is there a target to reduce it slightly each year?

Why not just harmonise the salaries altogether and match them to men’s??

(6)(10)

Anonymous

For people doing different jobs?

(6)(2)

Rachel

The spam likes tell me everything I need to know

(5)(7)

Anonymous

Everything you want to know, more like. You now know the pay gap is nothing to do with gender.

(22)(6)

Rachel

You’re right.

Pay gap is more to do with ethnic pay gap.

Thanks for clarifying and making me see the light!

(2)(10)

Anonymous

No worries!

Glad I could help

(2)(2)

Realist

Read the comments under this article, to understand why the gender pay gap in law is nonsense: https://www.lawgazette.co.uk/practice/female-talent-drain-still-a-problem-for-profession-rafferty-lj/5068199.article

The gender pay gap is a made-up figure for those craving victimhood. Annabel Denham wrote this concise summary of why it is simply contrived rubbish:

** Feminists mislead women with talk of the gender pay gap **
Annabel Denham, 30 November 2020, The Times, https://www.thetimes.co.uk/edition/comment/feminists-mislead-women-with-talk-of-the-gender-pay-gap-9sgmkgcvg

Amid the biggest health and economic crisis Britain has faced in peacetime, the Fawcett Society saw fit on November 20 to celebrate the highlight of its year: Equal Pay Day. As usual, it was accompanied by hysterical cries that women were “working for free until the end of December!”

It has been illegal since the 1970 Equal Pay Act to pay men and women different wages for the same work. Fawcett’s assertion is based on cherry-picking data that paints a misleading picture and feeds a tired narrative of sexism in the workplace.

What’s more, it uses mean rather than median data (in contrast with the Office for National Statistics), which enables it to include a small number of exceptionally high salaries, distorting the true picture. And it fails to take into account key differentials: the type of job, educational qualifications, work experience, or less tangible qualities that lead an organisation to rate one employee above another.

The real problem with the determination of groups like the Fawcett Society to “expose” gender pay gaps — such as the requirement for organisations with more 250 employees to publish wage data — is that it harms business. It triggers unjust demonisation of companies by comparing the salary of a male chief executive with that of a female trainee. It deters businesses from hiring female staff in lower-paid but essential roles. It sows discord among workers. And it tells young women that, no matter how hard they work or how talented they might be, they will never be as successful as their male counterparts.

In the coming weeks and months feminists will doubtless ramp up their panicked reports of women faring worse than men during the pandemic. This isn’t supported by the evidence. From July to September the female unemployment rate was 4.3 per cent, compared with 5.2 per cent for men. The redundancy rate, per thousand, was 10.9 for women and 11.6 for men. Women are disproportionately employed in the public sector, where workers are more concerned about salary freezes than they are about job losses.

The left’s fixation with pay needs to end. Why shouldn’t people choose careers that offer a better work-life balance or flexible hours instead of big headline salaries? Why should jobs be evaluated on wage rather than fulfilment? Far better to circumvent the obsession with female victimhood, celebrate the astounding revolution in women’s lives over the past century, and focus on those areas where women still deserve better.

Annabel Denham is director of communications for the Institute of Economic Affairs think tank

Kate Andrews, Economics Correspondent at The Spectator, has also written on it extensively. For example:

“Would we condone teaching a child that 1+1 = 3, for the sake of increasing her interest in maths? No. Would we praise flat earth theorists for getting people talking about the health of the planet? No. So why are we giving credence to meaningless and often deceptive gender pay gap statistics, which have us focusing on women’s issues in a way that is damaging to women? With Brexit-mania dominating our national debate, you may have missed that today is the deadline for large organisations to report their gender pay gap data.

Now into the second year of reporting, it has become increasingly clear that the influx of data from the gender pay gap reporting measures fails to provide any meaningful insight into fair pay for men and women in the workplace. …The measures don’t even distinguish between full-time and part-time workers, which makes a huge difference to results.

To highlight just how bad the reported data is, look at the accusations made against the National Health Service and its alleged gender pay gap. The public body has been flagged for its 23 per cent gender pay gap – a gap that increases to 33 per cent when just looking at GPs. But the majority of NHS professionals are on a national pay scale, almost completely removing questions of gender discrimination in wages, as they are not subjectively set by managers, but instead set irrespective of circumstance by the state.

Pay differences in the NHS are not about gendered pay gaps, but rather the number of hours worked by employees. Indeed, over 50 per cent of GPs are women, and they are more likely to work part-time. This is not rocket science, nor is it a conspiracy theory. It’s fairly simple stuff when the data is presented accurately. Unfortunately, the current legislation is not rooted in reason.”

Source: The problem with the gender pay gap obsession, Spectator, 4 April 2019, https://www.spectator.co.uk/article/the-problem-with-the-gender-pay-gap-obsession

Also see:

Stop unfairly demonising firms that have large gender pay gaps, City AM, 5 April 2019, https://www.cityam.com/stop-unfairly-demonising-firms-have-large-gender-pay-gaps

The Gender Pay Gap Reporting Measures: 2019 Update, IEA, 4 April 2019, https://iea.org.uk/publications/the-gender-pay-gap-reporting-measures-2019-update

Politically Incorrect Paper of the Day: The Persistence of Pay Inequality
by Alex Tabarrok, October 8, 2020 at 7:25 am
https://marginalrevolution.com/marginalrevolution/2020/10/politically-incorrect-paper-of-the-day-the-persistence-of-pay-inequality.html [extract: Gender wage gaps appear even in markets where workplace discrimination is impossible or unlikely. Uber driver’s for example are assigned trips using a gender-blind algorithm and earn according to a known formula based on time and distance of trip. Yet, a small but persistent gender gap of about 7% exists (https://marginalrevolution.com/marginalrevolution/2018/02/uber-pay-gap.html) which appears to be due mostly to the fact that male drivers drive a little bit faster, choose to work in more congested areas, and have a bit more experience. Litman et al. (2020) (https://journals.plos.org/plosone/article?id=10.1371/journal.pone.0229383) show that the same kind of difference also show up in earnings on Mechanical Turk…]

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Fun at Parties

Dude (or however you self identify)…. chill.

I don’t know what’s more sad, people with “incoming open day attendee” on their LinkedIn or people who feel compelled to spend what is clearly a considerable amount of time posting a research piece, with referencing/links, on a trashy law blogger site.

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Forever Associate

How about the general pay gap within the ranks and clear exploitation of all fee-earners by British firm partnerships? This is an underlying inequity that if not addressed will continue to slow progress on the gender pay gap.

First, the annual income disparity between the top of the equity spot and the base NQ fee-earner at most of the top UK law firms is typically a factor of 10. Some people may think that’s ok, some people may take the view that it is excessive. I am on the fence on this subject. Given the partners I have worked for over the years I can see justification for this in some circumstances, but not always.

Second, it has been a widely-accepted norm of the professional world that your total compensation should be 1/3 of your billings. 1/3 is kept for costs and 1/3 is kept for firm profit. Even automotive repair shops adopt this structure. Financial targets at most British firms are typically 4x, or even more than 5x that fee earner’s annual income even including the pathetic bonus structures… what, 5% if you hit the minimum target and max 12 or 15% if you bill 2000 hours a year? When I was a NQ, which wasn’t THAT long ago, my annual targets were just shy of £300k. With the maximum bonus, which was given around 1800 hours billed (my base target was 1500), I was lucky to make just under £70k total gross income. It’s worth keeping in mind my firm at that time was known for having a “generous” bonus scheme for a British firm. I think the NQ targets at that firm now are over £350k with maximum gross compensation still well below £90k, even if billing nearly 2000 hours a year.

Right from lower/mid-tier London firms to the MC, I can almost guarantee this will be the standard position. And then Pinsents and Fieldfisher have the absolute gall to complain about raising NQ salaries when they are clearly underpaying by 20-40%. Given that more women are becoming NQs than men, yet women in senior roles continue to be an issue, this is inevitably going to add to the gender pay gap disparity too.

TL/DR; the fee earner income expectation vs compensation system is fundamentally flawed. British firms specifically need to drastically increase pay to associates or be more realistic with their hour/financial targets. But what do I know?

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