News
Jessica Fino 2 May 2017 11:57am

Number of female high earners remains static

The proportion of female high earners has remained unchanged for the last six years, according to data from HMRC, despite attempts to increase the number of women in senior positions

The law firm Clyde & Co found that women accounted for just 27% of all higher rate taxpayers, the same percentage since 2011/12.

According to data obtained from HMRC, the number of higher rate taxpayers decreased for the first time in seven years to 4.41 million, from 4.64 million last year. Of these, only 1.19 million were women.

However, the number of higher rate taxpayers (those who declared an income between £43,001 and £150,000) has grown by almost one million over the last six years.

Heidi Watson, employment partner at Clyde & Co, said, "The stubborn refusal of the percentage of female high earners to shift upwards will disappoint those who hoped a recent focus on the gender gap would make a significant difference to the number of women in senior positions."

The government has recently launched a new initiative aimed at reducing gender pay differences by making organisations with 250 or more employees and workers disclose gender pay and bonus pay gaps.

Businesses' gender pay figures will be published on a government website where the public and prospective employees will be able to look at the data in comparison with other employers.

Gina Wilson, also an employment partner at the law firm, said, "On the face of it 'naming and shaming' can appear to be a fairly impotent punishment. But the reputational risk is huge.

"Companies who report better figures, or show that they are improving, stand to gain a competitive advantage when looking to hire top female talent.

"It's important to remember that as well as reputational damage, the Equality and Human Rights Commission can take its usual enforcement action against employers who are proven to be in breach of the Equality Act, which can in theory ultimately lead to criminal proceedings."

The current timeline for mandatory gender pay gap reporting requires employers to capture data on 5 April 2017 and then publish findings no later than 4 April 2018, with this cycle continuing on an annual basis.

Wilson added, "Businesses should be taking steps now to analyse their April 2017 data so that they can take remedial steps ahead of the reporting deadline in April 2018. If they can make a difference over the next 12 months then they could consider releasing their April 2017 data, followed closely by their April 2018 data which could show a marked improvement.

"For those yet to report, it is advisable to look at how other businesses that have already released their data have presented it. In most cases, the best way will be to provide as much information as possible with any gaps explained and efforts to close it outlined."

Last year, some of the UK’s major banks and organisations set out their gender targets for the next decade as part of the Treasury’s Women in Finance charter.

Businesses who sign the charter pledge to support the progression of women into senior roles in the financial sector by focusing on the executive pipeline and the mid-tier level.

They are also required to publicly report on progress to deliver their targets, in a bid to support transparency and accountability. Each firm is encouraged to set its own targets and implement its strategy for their organisation.

The charter launched last year and has 122 signatories, including PwC, EY, the Financial Conduct Authority, the British Bankers’ Association and HSBC.

Since its inception, 77 financial services firms have committed to have at least 30% of women in senior roles by 2021 and 23 firms have committed to a 50/50 gender split in senior roles by 2021.

A government spokesperson said, “No woman should be held back just because of her gender. We now have the lowest gender pay gap on record and that’s as a result of the changes we’ve made so men and women can share their parental leave, our work to get more women into the top jobs at our biggest companies and our drive to get more girls taking STEM subjects at school that will get them into more lucrative professions when they are older.

“But we know there’s more to do. That’s why we are requiring employers to publish their gender pay and gender bonus gap for the first time from April and we are giving working parents up to 30 hours of free childcare from next September, meaning women can go back to work and progress in their careers after having children if they choose to.”

However a report Egon Zehnder’s Global Board Diversity Analysis (GBDA) published in February found that gender diversity on UK boards is still lagging behind many western European countries, with the percentage of new female hires falling in 2016 compared to two years earlier.

Women held 26.3% of the total board positions in the UK, compared to 39.7% in Norway, 37.7% in Sweden and 37.5% in France. The percentage of women being hired as directors in the UK has fallen from 32.1% in 2014 to 29% in 2016.

Topics