Women are paid 80% less in bonuses than men in the City of London.

Women are paid 80% less in bonuses than men in the City of London, UK, according to The Equality and Human Rights Commission in its inquiry into the gender pay gap.

The Commission’s Finance Sector Inquiry includes data from a questionnaire sent to 50 companies employing 22.6% of workers in the sector. It reveals nearly all women taking up new jobs in these companies still start on lower average salaries than men, suggesting the gender gap is being further entrenched by recruitment patterns.

The Inquiry is the first time this type of data on gender pay gaps in the sector has been collected, with the Commission using its statutory powers to require companies to provide evidence of their working practices and policies including pay, job evaluations and audits.

It found that average performance related pay for women was just £2,875 compared to £14,554 for men. There was also a considerable distance between basic pay with women earning 39% less than men – rising to 47% for annual total earnings when performance related pay, bonuses and overtime were taken into account.

Among the 44 organisations who responded, which employ almost 300,000 workers – about a fifth of the sector’s workforce, women received significantly lower performance related pay on average than men in 94% of cases. Significant ‘in-grade’ gender pay gaps in at least half of all job grades/categories, where men and women are assumed to be doing the same or equivalent work, were found in 63% of cases.

Trevor Phillips, Chair of the Commission said: “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. 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.”

Harriet Harman, Minister for Women and Equality, who commissioned the study, said: “It’s unlikely that men-only boards and management would ever deliver the change in working culture, such as family-friendly flexible working and childcare, that will allow women to flourish in the workplace.”

Whilst there were some examples of good practice in some of the organisations questioned, with one employer reporting that they made data on average bonus payments by gender available to employees and another offering a maternity buddy system to support pregnant women and those on maternity leave – less than half of cases reported making any effort to address the pay gap.

Moving forward, the recommendations included appointing a board member to champion the issues of pay inequality and the Commission said it would now start working with finance companies to develop solutions to the pay inequalities identified in the report.

The Commission is a statutory body established under the Equality Act 2006, which took over the responsibilities of Commission for Racial Equality, Disability Rights Commission and Equal Opportunities Commission. It is the independent advocate for equality and human rights in Britain.

For more information and to read the full report, click here.