Pay Equity After the Equality Act 2010: Does Sexual Orientation Still Matter?

Using nationally-representative linked employer-employee data for Britain I find bisexual men earn around 31% less per hour than heterosexual men, a differential that falls to 20% having controlled for demographic, job and workplace characteristics. The gap is apparent within workplaces and within detailed occupational classifications. There is no wage differential between gay and heterosexual men. Among women, on the other hand, there is no wage gap between bisexuals and heterosexuals. However, lesbians are paid nearly 30% less than heterosexual women, unless they are employed in a workplace with an equal opportunities policy which explicitly refers to sexual orientation, whereupon there is no wage gap. Although I find evidence consistent with workplace sorting by sexual orientation this does not affect the size of the sexual orientation wage gaps. Tests designed to identify the potential effects of employer taste-based discrimination, statistical discrimination and co-worker discrimination are inconclusive.