After a slew of high-profile sex discrimination lawsuits hit Wall Street in the 1990s, one might think the financial industry would have learned its lesson. Not so, says Louise Marie Roth author of Selling Women Short: Gender and Money on Wall Street (Princeton University Press 2006). Roth’s research illustrates how Wall Street’s myth of meritocracy permits America’s financial capital to continue to discriminate.

This disparity persists because individuals with similar qualifications and performance are paid similar salaries, but their bonus pay is more subjective. After interviewing 76 men and women who began their careers during the long bull market of the late 1990s, Roth concluded that Wall Street’s highly variable pay system led to gender discrimination.

Recently, Roth shared her findings in a lecture entitled, "Having It All? Workplace Culture and Work-Family Conflict on Wall Street," as part of the Colloquium series sponsored by the MARIAL (Myth and Ritual in American Life) Center at Emory University.

According to Roth, this subtle yet recognizable “structural discrimination” against women occurs when the unconscious biases of managers, coworkers, and clients influence performance evaluations, work distribution and pay.

In fact, the women Roth interviewed earned an average of 29% less than their male counterparts, and were relegated to less lucrative career paths, were promoted less often, and were routinely denied access to the best clients. This occurred in an environment where opportunities on Wall Street were ample and women should have had more of a chance to advance.

Working fathers, even though they tended to work less (61 hours a week) than childless workers of either gender (68 hours for childless men; 62 for childless females), made the most money—approximately $9700 per week or $502,400 per year. The average working mother’s compensation was slightly over $5600 per week, or $291,200 per year, even though she worked nearly as many hours as the fathers.

“Coworkers and manager’s perceptions of women were influenced by gendered assumptions about work and family roles that spilled over into the workplace,” Roth told the audience of Emory University students and professors. “This affects how men and women are treated in the workplace.”

The main issue—still at play today—is that the most senior workers on Wall Street are usually white men with stay-at-home wives. “This is especially true in the highest paying areas of these firms. There are some women in high-level positions, but they tend to work in lower-paying (relatively speaking) female job ghettos,” writes Roth in a follow-up email. “Because the pay system is so variable and is supposed to be based on performance, biases in allocation of work—which represent opportunities to perform—and in evaluations of performance, whereby women are held to a higher standard than men, have large and meaningful effects on inequality in earnings.”

In her book, Roth delves into the influences that lead to unequal assignment of accounts and clients, as well as the subjective and biased assessments of performance. Part of the problem, and what Roth’s colloquium focused on, is Wall Street’s workaholic culture.

“Wall Street has a culture of around the clock devotion,” she explains. “The ideal worker is a workaholic.” While not unique to Wall Street, the workaholic culture is intensified there, and the ideal worker is one with a support person who takes care of the worker’s non-work life.

For this reason, Wall Street is an extreme example of the “breadwinner/homemaker” cultural template. Roth pointed out several studies that show highly paid workers were more likely to have a homemaker wife. Having such support allows them to dive in to the workaholic model and this, in turn, affects their coworkers. “It sets a precedent for demands on subordinates,” adds Roth. “They have to live up to the same unfettered career devotion.”

Cancelled dinners, delayed vacations—they’re all part of the workaholic culture on Wall Street. “[The culture] skews the work/life balance in favor of work,” says Roth, who added that there are strategies in place to sustain the culture. “Management creates incentives for workers to buy into the workaholic system.”

Unfortunately, the workaholic system places women at a disadvantage because of the perception that a woman’s devotion to family trumps all else.

“It’s a gender double standard,” notes Roth. Studies show that marriage increases the credibility of men whereas it is seen as decreasing a woman’s commitment to her job. The assumption is that workers shouldn’t have any responsibilities outside work, and that they weren’t expected to acquire them. In fact, women were equated with work/family conflict even when they didn’t have children.

“There’s a cultural assumption that women will drop back or drop out when they have children,” says Roth. Because females are viewed as potential mothers, adds Roth, “A woman’s commitment to a workaholic standard is always suspect and they’re not evaluated as positively as men with similar devotion.”

On Wall Street, Roth concludes, women were viewed as less than ideal workers. “This persisted even when the evidence did not support this,” says Roth, who is an assistant professor of sociology at the University of Arizona. In essence, Wall Street’s workaholic culture and working mothers were (and Roth contends, still are) viewed as incompatible.

Ironically, many of the companies these women worked for continue to appear on various “best companies for working mothers” lists due to their noteworthy flexible schedule policies. “They have great formal policies on paper—telecommuting, job-sharing, flex time,” says Roth. “Women told me that, ‘yes, we have those, but not in my job.’” Those options appear to be exercised more often by women not in upper management positions.

Some of the women Roth interviewed claimed their performance valued bonus was declined after they had children because of the perception they were less committed. More than 30% of the pregnant women and mothers Roth spoke with eventually changed jobs to attain a work/life balance. According to Roth, in the late 1990s, pregnancy and motherhood led to some of Wall Street’s most blatant discrimination. “It’s still quite prevalent,” she contends.

In reality, only 20% of the mothers Roth interviewed actually quit. “They’re not opting out,” she says. “They were all pushed out by discrimination.” Even if the women didn’t experience any obvious discrimination during their pregnancy, many felt negative feedback after giving birth. “Women who leave are often prodded by hostility and subtle forms of discrimination in the workforce.”

Three of the women Roth interviewed quit after their 1997 bonuses were much less than those of previous years. In each case, the women believed, the reduction came about because their managers believed they performed negatively after their pregnancies. “But each of the women felt they were still performing as well as before their pregnancy,” notes Roth.

One of the women Roth interviewed took a 20% pay cut when she reduced her hours by 20%. She understood that bonuses should reflect an employee’s commitment to the firm and his or her performance; however, the bonus she received after cutting back her hours was incredibly low. She told Roth, “It pushed me over the edge.” She decided she’d rather be a stay-at-home mother than be undervalued at work.

“But it wasn’t her personal desire to leave her job,” stresses Roth, who explained that it was the structure of the workplace that forced the woman to leave, not personal choice. The woman was penalized even though flextime was available. According to Roth, flextime is in conflict with Wall Street’s workaholic model.

Unfortunately, the breadwinner/homemaker model—less common in the general population than it once was—is imbedded in Wall Street’s culture. “It’s an institutionalized pattern,” says Roth.

When a student asked Roth if gender inequity were something Wall Street was stuck with, Roth was hopeful. She suggested that there might be ways to make performance evaluations “fair.” It may not always be possible to be objective, she says, but if those at the top were held accountable for discrepancies when ranking people in the same position, things might improve.