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Top women in-house lawyers paid 22pc less than men

Michael Pelly
Michael PellyLegal editor

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Women dominate the ranks of corporate counsel but are paid a "disheartening" 22 per cent less than their male counterparts when it comes to the best jobs.

That's the bad news from a study of more than 5000 people across 86 countries conducted by the Association of Corporate Counsel (ACC), along with the fact Australians are paid much less than the global average.

The good news is that the pay disparity doesn't apply across the board. For the top 25 per cent by pay in Australia – the survey did all its accounting in US dollars– the difference was significant; $US236,000 for men ($316,000) and $US195,000 for women.

Women dominate the ranks of corporate counsel but are paid a "disheartening" 22 per cent less than their male counterparts. Louise Kennerley

However, the average pay in Australia was $US206,000 for men and $US200,000, a difference of only 3 per cent. The gap was 27 per cent in the United States ($US335,000 for men and $US245,000).

ACC vice-president Tanya Khan said: "While it was not a surprise, it was certainly disheartening to see the extent of gender pay disparities in the in-house community."

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She said there were 14,000 corporate counsel in Australia, or 20 per cent of the legal profession.

More than 70 per cent of counsel were women. However, they only comprise 50 per cent of leadership positions across the board – up from 38 per cent in 2012 – and less for publicly listed companies.

"If it makes more money and it's got more employees, that's where males typically dominate in leadership positions," Ms Khan said. "So, they continue to make the bigger wages."

She noted "the gap appears to shrink for newer generations" with women at entry level earning 98 cents on the dollar compared to their male colleagues.

Global benchmark

The pay gap peaks for lawyers who have worked in-house for 11-20 years, with women in that group receiving only 69 per cent of the male wage.

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More than 77 per cent of the respondents were from the US, but Australia was the second largest group with 8 per cent.

The study says the top 5 per cent of general counsel/heads of legal in Australia are paid an average $US694,498. The top practice areas are healthcare ($US1.9 million for the top 5 per cent), construction ($US1.6 million) and telecommunications ($US1.5 million).

It's still well short of the global benchmark. The top fields were biotechnology or technical/research and the top 5 per cent of counsel in those two areas earned $US3.3 million ahead of accommodation/food services ($US3 million). The average for the top 5 per cent by pay across all industries was $US1.14 million.

Ms Khan said that while in-house lawyers have traditionally been generalists, larger legal teams are hiring specialists at bigger salaries to do the work they did at their old firms. "I think that trend is going to continue."

She added the traditional path has always been to spend time in private practice, but large corporates were increasingly targeting graduates. Last year, she said, 12 per cent of graduates went straight into in-house roles with companies such as Woolworths and Westpac.

Ms Khan said that while salary growth had been modest in 2017, half the respondents had access to flexible working arrangements: "That's heartening. More family friendly working environments have long been considered an attraction of the in-house sector."

Michael Pelly is the legal editor, based in our Sydney newsroom. He has been a senior adviser to federal and state attorneys-general and written two books, one a biography of former High Court Chief Justice Murray Gleeson. Email Michael at michael.pelly@afr.com

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