Tribunal exposes gender gap in banking culture and pay
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When Stacey Macken arrived at work at the main London office of BNP Paribas one morning in 2013, she found a witch’s hat on her desk. A witness to the incident said male members of her team had left it there the previous night, when they returned from the pub “visibly drunk”.
The incident was one of several to emerge from an employment tribunal case won by Ms Macken against the French bank, painting a picture of a laddish culture that failed to make her welcome as a female member of staff.
But lawyers and consultants say exposing this type of behaviour is not the only important breakthrough in the judgment, which was published earlier this month: in addition, it shines a light on the wide disparity in pay and bonuses that ensnared Ms Macken.
The employee in BNP Paribas’ prime brokerage division, which deals with hedge fund clients, had believed she was on an equal footing with a male counterpart, based on her job description and official contracts, the tribunal records show.
Without her realising, however, Ms Macken’s boss had decided that she was to be treated as a junior to her male colleague, despite her having more relevant experience.
Her basic salary was 25 per cent less than that of her male peer and her first-year bonus payment was less than half that he received, despite equal grades for their performance. By 2016, three years after joining, the gap between Ms Macken’s bonus and her colleague’s award widened to 85 per cent.
The UK employment tribunal judgment found that Ms Macken was subjected to “direct sex discrimination and victimisation” throughout her employment, as a result of her being treated as “a junior” to her colleague purely on the basis of her sex — which it said was a determining factor in all the bonuses she was awarded.
Susannah Donaldson, a legal director at law firm Pinsent Mason, said such cases are “notoriously complex and extremely technical” and companies tend to settle before a hearing to avoid a public forum. “Companies are keen to avoid other employees starting to bring similar claims because the potential liability across the whole workforce could have a big impact,” Ms Donaldson said.
According to a report based on gender pay gap data, women working in the City on average receive £33,000 in bonuses for every £100,000 awarded to men. This disparity has been historically one of the key reasons women left the industry, which in turn means that banks are finding it hard to recruit women with sufficient experience for senior roles.
Denis Pihan, Ms Macken’s former boss and the head of international product development at the bank, told the tribunal that “as far as they are aware, [Ms Macken and her male colleague] do the same role,” but he felt that Ms Macken’s experience made her a junior hire.
A spokesperson for BNP Paribas said the bank takes its responsibilities on equality in the workplace “extremely seriously” and that it has a “zero-tolerance policy on discrimination”.
“We are disappointed with the judgment and do not believe it is a true reflection of our culture,” the spokesperson said.
Last year, the parliamentary Treasury select committee published a report calling for wideranging reforms to the process of negotiating bonuses in financial services. Instead of relying on subjective and highly discretionary awards determined by managers, the committee called for assessments to be instead performed against a “clear set of criteria”.
“The alpha-male culture in some organisations is evident in bonus negotiations . . . [which] can result in higher rewards for men, and acts as a deterrent for women,” the Treasury’s report said.
The lack of clear guidelines leaves the system open to subjective judgment and unconscious bias, said Corinne Carr, a remuneration consultant and founder of PeopleNet, an organisation promoting responsible pay structures.
Barbara Leveel, head of global markets HR at BNP Paribas, declined to comment on the tribunal’s decision but said the competitive nature of the business can often mean that managers fail to appreciate the importance of paperwork around performance assessments and compensation.
“Diversity is a key focus for us and we have done a lot of work around putting projects in place that aim to increase female representation at all levels,” Ms Leveel added.
Consultants say the lack of pay grades and pay bands in banking has made it hard to benchmark remuneration. Ms Carr describes a “hotchpotch of individuals doing ‘equal work’ and being paid very differently”, depending on how much the incumbents used to earn in their previous jobs and how good their negotiating skills are.
“If there are no pay bands, HR is not able to issue guidelines to line managers on how to set pay on recruitment and monitor it during employment in a consistent and fair manner,” Ms Carr said.
In October last year, the Chartered Insurance Institute published a study showing that the average 65-year-old woman retires with a pension pot of less than £36,000, just one-fifth of the average for men — with the gender pay gap a significant contributor.
* This story was amended on 20 September to make clear that Ms Macken is still employed by BNP Paribas