The proportion of UK female high earners has remained static for
the past five years, despite the drive to increase the number of
women in senior positions, according to new research from global
law firm Clyde & Co.
"The figures have remained static because initiatives so
far have been voluntary and aren't sufficient to bring about
change. What's now proposed is a firmer approach through
legislation being introduced later this year that obliges
businesses employing 250 or more employees to report their gender
pay gap. Businesses should promptly carry out mock audits (ideally
through Solicitors so that the information is legally privileged)
in order to take steps to reduce the gap ahead of the reporting
deadline." - Gina Wilson
Data obtained directly from HMRC reveals that women
accounted for just over one quarter (27%) of all higher rate tax
payers in each of the last five financial years. Last year just
1.26m of the 4.64m higher rate tax payers were women.
Clyde & Co points out that the percentage of female high
earners in the UK has not changed for five years even though the
total number of higher rate tax payers in the UK has grown by over
There have been several recent government and industry
initiatives launched to increase representation of women in senior
Lord Davies' new target for FTSE 100 firms to have 33%
female board members by 2020.
A voluntary charter aimed at getting more women into senior
roles in the financial services industry, which several major UK
banks have signed up to.
Many individual businesses are setting their own targets - last
year Lloyd's Banking Group announced that they are aiming to
have women in 40% of their Senior Management roles by the end of
Heidi Watson, Employment Partner at Clyde & Co, comments:
"It is clear that the initiatives launched so far have not had
an impact on national figures for women in high earning positions,
which in turn impacts on the national gender pay gap. The
Government will be hoping that the new gender pay reporting rules
can change that."
Clyde & Co explains that the most recent and significant
Government initiative aimed at reducing gender pay differences is
gender pay gap reporting.
In July 2015 David Cameron announced new rules that will require
UK organisations with 250 employees or more to publish information
about the difference between the average pay of their male and
female employees (details of full reporting requirements and
Heidi Watson continues: "While there are no penalties for
breaching the rules, the risk of reputational damage is high. Some
critics believe the rules lack teeth but the public scrutiny firms
will face through 'naming and shaming' is likely to be
"One of the most significant causes of the pay gap for most
organisations is the lack of women in senior roles. If an
organisation can crack this, they will be way ahead of their
competitors. This data shows the impact of any current
programmes is not yet being felt".
Charles Urquhart, Employment Partner at Clyde & Co, says:
"With only 8 months to go businesses should be trying to get
ahead of the game before the first round of reporting is
"There are steps that organisations can take now to ensure
that the data that they have to publish presents the organisation
in the best light. These include: conducting an audit (after taking
legal advice, to ensure that the results are subject to legal
privilege); analysing the audit data to identify areas of concern
and then endeavouring to resolve those concerns".
"A number of organisations have tested the audit process
already and found that the results were even worse than feared.
Forewarned is forearmed and by starting to consider compliance
early, organisations can begin to review how they recruit, promote
and reward their staff with a view to identifying and then ironing
out any gender based barriers which might hamper success."
Heidi Watson adds: "Don't get caught out: identifying
problem areas now also allows employers to consider what additional
information they might publish, over and above that required by the
new regulations, to tell a positive story about the way in which
the organisation values its workforce and is working to reduce any
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