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Don’t tell Wall Street executives how to pay their people.
At least that’s what the two co-chairmen of the Partnership for New York City, a non-profit membership organization made up of top business leaders in New York City, told the Mayor’s representatives, The New York Times reports.
The two men – Stephen A. Schwarzman, chairman and chief executive of the Blackstone Group, and Michael L. Corbat, Citigroup’s chief executive – are among a growing chorus of Wall Street executives complaining to deputy mayor Alicia K. Glenn, who oversees housing and economic development, about a new law that will change the way Wall Street firms negotiate compensation packages.
Their biggest concern?
That the recently passed New York City law, which bans public and private employers from asking job candidates about their current or previous salary, will make recruiting and paying top talent more challenging, according to The New York Times. The law will go into effect in November.
Letitia James, a public advocate who introduced the legislation, begs to differ. Discussing previous salary information increases wage discrimination, according to James.
“Being underpaid once should not condemn one to a lifetime of inequity,” James said in a press release when the bill was passed in April.”We will never close the wage gap unless we continue to enact proactive policies that promote economic justice and equity.”
The stakes are high for Wall Street firms – in 2016, employee compensation totaled nearly $24 billion, according to the city comptroller and reported in The New York Times.
Other reasons to be concerned, according to the complaints reported in The New York Times:
The new law may decrease pay for men, rather than leveling the compensation playing field for women. And, by extension, it could negatively impact New York City’s tax revenue.
As for deputy mayor Glen, she expects this law will have a positive impact. She explained to The New York Times:
“We have to break the cycle of pay discrimination. Every firm is grappling with how to retain and promote more women into their senior leadership – this is part of the solution. Having spent more than a decade on Wall Street, I fundamentally believe this industry will be stronger when women up and down the ladder are compensated fairly.”