If government consider that the time is right to deliver another reporting obligation on employers, in the name of transparency, significant time and structured planning will be needed. Rushed delivery will not achieve accurate outcomes.
Lessons need to be learned from the roll out of gender pay gap reporting with government engaging in greater detail with all affected stakeholders as they continue to consult.
Employers pay processes vary in size and complexity enormously and with the added challenges for gathering accurate ethnicity data, as identified within the consultation paper, will add further layers of complexity.
We see this consultation as the start of a conversation and not the end of it and look forward to being involved in further discussions.
Read the full CIPP response to the consultation on ethnicity pay reporting.
All consultation responses are available in the Policy hub under My CIPP on our website.
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Ethnicity pay gap reporting 21 May 2019
The jury is still out on what mandatory reporting may come into force as the Government is still considering the responses to its consultation.
Introduction Back in 2017 the ‘Race in the Workplace’ report from Baroness McGregor-Smith, recommended that government should legislate to introduce mandatory reporting of ethnicity data. At the time, the government said that the case had been made for ethnicity reporting and it expected businesses to do this voluntarily. It did however ask Business in the Community (BITC) to assess what steps employers have taken to haul down workplace barriers and harness the talent of a diverse workforce. A review of the ‘Race at Work’ report one year on (2018) found that barriers persist in the workplace. The review included a number of calls to action for business and contributes to the Industrial Strategy goals of boosting productivity by backing businesses to create good jobs and increase the earning power of people throughout the UK with investment in skills, industries and infrastructure. Monitoring ethnicity and pay The 2018 review found that just 11% of employees reported that their organisation collects data on the ethnicity pay gap ratio - in particular those in small organisations are much less likely to report that their organisation collects data on the ethnicity pay gap ratio, just 8%.
Of those people who work in an organisation that collects data on the ethnicity pay gap, 50% reported that their organisation publishes the data that they collect.
‘Race in the Workplace’ recommendations on monitoring ethnicity and pay include:
• Listed companies and all businesses and public bodies with more than 50 employees should publish five- year aspirational targets and report against these annually. They should also publish a breakdown of employees by race and pay band. • All employers should take positive action to improve reporting rates amongst their workforce, explaining why supplying data will improve diversity and the business as a whole. • Government should legislate to ensure that all listed companies and businesses employing more than 50 people publish workforce data broken down by race and pay band.
Government consultation
The Chartered Institute of Payroll Professionals
Payroll: need to know
cipp.org.uk
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