The omission of partners from gender pay gap reporting has been strongly criticised by the Treasury Select Committee inquiry into gender diversity in the financial services industry, with City minister John Glen MP branding the practice as "outrageous".

In its Women in Finance report, published yesterday (12 June), the committee said firms are "circumventing the spirit" of gender pay legislation by not including partners in their reporting, and called on the Chancellor of the Exchequer Philip Hammond MP to be "vociferous" on the issue.

Conservative MP John Glen, who earlier this year was appointed Economic Secretary to the Treasury, told the committee that not disclosing the figures was an "outrageous attempt to thwart the spirit and letter of what is required, which is actually to be transparent about a very serious issue that society is very concerned about".

Glen added: "It is sending totally the wrong signal to the next generation who are contemplating apprenticeships and careers."

The inquiry, which was launched in October last year, set out to examine the value to financial firms of having a greater gender balance, identify the barriers to entry for women, and ensure firm cultures, policies and practices support the aspirations of women.

This week's report outlines how government guidelines on gender pay reporting allow firms to omit partners from their reporting as they "take a share of the organisation's profits, which is not directly comparable with employees' pay".

Earlier this week, it was revealed that Allen & Overy (A&O) has declined to provide MPs with its 2016-17 partnership gender pay gap figures, despite the Business, Energy and Industrial Strategy Committee requesting the figures from all magic circle firms.

A&O told Legal Week that it will provide the select committee with a gender pay gap figure including partners for the 2017-18 financial year by September. A spokesman said the firm had not yet decided whether it would release the data for the 2016-17 year.

This request followed the appearance of Slaughter and May HR director Louise Meikle in front of the Business, Energy and Industrial Strategy Committee, where she faced questions over the magic circle firm's decision not to include partners in its pay gap reporting.

Meikle told the committee that the firm "would be happy to publish" the data if it was given "clear guidance" on how to do so.

Magic circle rivals Linklaters and Clifford Chance voluntarily included partners in their pay gap reporting, while other law firms to voluntarily do so included Reed Smith, Norton Rose Fulbright, Pinsent Masons, Hogan Lovells and Irwin Mitchell.

Photo credit: Ian Paterson