17 mai 2023
Law at Work - May 2023 – 3 de 8 Publications
A 2019 Government report on ethnicity revealed an ethnicity pay gap of around 23% in London and around 1.4% in Wales.
This stark statistic reveals an obvious point: where you have a higher concentration of ethnic minorities, you are going to have a much wider pay gap than in a population that tends not to be ethnically diverse. The same is likely to be true in large, multicultural workforces as compared with small, homogeneous workplaces. This means that, when it comes to eliminating an ethnicity pay gap, most of the progress to be made is in already ethnically diverse workplaces. Paradoxically, those workplaces which consider that they 'don't have a problem with race' are the ones which could derive most benefit from the guidance.
In April 2023, the government published voluntary guidance on ethnicity pay gap reporting. In broad terms, it highlights that much of the guidance mirrors what can be found in the guidance on gender pay gap reporting, with the important difference that ethnicity pay gap reporting is far more complex because it involves more than two groups. There is also currently less data gathered about ethnic profile so the starting point is not so clear-cut.
The guidance emphasizes that there must be sufficient data gathered in order for the exercise to be meaningful. The data set should be sufficiently large to reveal a trend; for reasons of privacy, it should also not be possible to identify individuals within the data set. The guidance recommends a minimum of 50 persons within each ethnic group; where this is not the case, smaller groups should be aggregated together.
Once the data has been gathered, comparisons between groups may be made, and an analysis of the reasons for this. The guidance recommends a granular approach when making comparisons, so not going a binary comparison between white and non-white groups.
The guidance is divided into five sections and below is an extract of some useful points from each:
The guidance recommends calculating:
Increasingly, Diversity and Inclusion (D & I) initiatives are central to the DNA of an organisation. Decisions will often be made at board level, in conjunction with HR, about D & I priorities and strategy, possibly under the umbrella of a wider ESG strategy. The focus is not just on compliance but rather on championing best practice and bringing about culture change on a voluntary basis. With this in mind, and given that regulators and investors are giving greater attention to D & I as a measure of corporate health, businesses should familiarise themselves with what the guidance has to offer and decide:
A degree of speculation will be required before embarking on the exercise, essentially asking whether there is appetite to make changes within the organisation to address the causes behind any ethnicity pay gap. It is a bit chicken and egg: many organisations will avoid going down this route if they are not prepared to change the way they do things, others will embrace reporting if they already intend to address inequality. Care needs to be taken as not all measures to remedy inequality will be lawful. Any action plan should have regard to the limits set by the positive action provisions of the Equality Act 2010.
17 May 2023
par Helen Farr
17 May 2023
par Ruth Moffett
28 April 2023
3 April 2023
par Afshan Mallik