MEMBERSHIP INSIGHT
point what the preferred solution to this reporting challenge could be. ● ● What supporting or contextual data (if any) should be disclosed to help ensure ethnicity reporting provides a true and fair picture? – Comments highlighted concerns about variances that will be presented as a result of geographic differences in ethnic populations. There was also concern about the complexity presented with ethnicity pay reporting; there was, however, a recognition of the possible value that considering age and gender may have as long as the data numbers (headcount) were significant enough to be meaningful. ● ● Should an employer that identifies disparities in their ethnicity pay in their workforce be required to publish an action plan for addressing these disparities? – 70% of respondents believe that an employer should publish an action plan and recognise the valuable role it could play. However, commentary also suggests that there is a strong belief that a less prescriptive approach, as adopted with gender pay gap (GPG) reporting, would be preferred to enable employers to ‘tell their story’ in a way that best suits their situation. A simple accuracy declaration as required with GPG reporting would be preferred leaving the employer the freedom to select the most appropriate manner in which to narrate their experience, within their sector and their geographic location/s. ● ● Do you currently collect data on ethnicity at your workplace? – 44% of respondents do use standard ethnic classifications but of those who responded ‘yes’ 67% would need to carry out further research to inform them what classification is used. The 2011 Census: 5 standardised ONS ethnic classification was identified as being used as was HESA ethnic classification (https://bit. ly/2KGbFTY). ● ● What do you think are the most effective approaches for employers to improve employee self-reporting or declaration rates? – The majority of respondents felt that there needs to be a mandatory obligation in order for this to be adopted by employers that currently don’t collect this data. It was noted several times that this data isn’t currently being collected and so
additional time would need to be built in to allow this to begin, which will take longer with existing staff. There needs to be good communication with employees as to why this data is being collected and for what purpose, together with using multiple resources for employees to complete the declaration including online and self-serve facilities. Collecting it during the onboarding/ recruitment process was seen to be the most effective time. ...every step of the roll-out process ● ● How should self-reporting or non- disclosure rates be reflected in the information reported by employers? – Keep as simple as possible, reporting in an annual statement the number of employees who have elected not to disclose by including ‘not to say’ as an answer option together with the number who haven’t engaged – whilst explaining steps taken to collect data. This will in the short-term reduce effectiveness of figures reported but in itself could provide a starting point of ethnicity pay transparency with which the employer can build on in subsequent years. This was not a challenge faced by employers with GPG reporting and so any new policy delivery will need to provide ample time recognising that for the majority of employers this data isn’t currently collected and will need to begin before the first reporting year. ● ● For a consistent approach to ethnicity pay reporting across companies, should a standardised approach to classifications of ethnicity be used and what would be the costs to your organisation? – Costs will vary enormously – a more detailed survey will be useful when a firm proposal is known. ● ● Please outline steps that should be taken to preserve confidentiality of individuals – There was broad support for the restrictions applied within the civil service workforce statistics, but this could have the result of organisations at the smaller end of the reporting size range should be more structured and better promoted
never reporting accurate results – which in turn would place a greater challenge on the narratives needed in order to move towards providing transparency. Confidentiality is of particular concern in geographical regions with low ethnic working populations. Publishing more examples of best practice by using employer case studies from those currently reporting on ethnicity could provide a wider range of examples over and above the civil service example. ● ● What size of employer (or employee threshold) should be within scope for mandatory ethnicity pay reporting? – Though a five-employee threshold for inclusion of an ethnic group was suggested in the consultation paper (including employers with less than 500 employees), this might result in there being insufficient people in many of the ethnic groups for them to be included in the reporting. Many felt that if ethnicity pay reporting is to be mandatory the threshold should be in line with that for GPG reporting. One of the comments received suggested that an ‘all or nothing approach’ is the only way to obtain true data. ● ● What support measures do you think would be useful for employers? – Learning from the delivery of GPG reporting, every step of the roll-out process should be more structured and better promoted. More accurate information needs to be shared at a much earlier stage and the Department for Business, Energy & Industrial Strategy will need to set out a clear and achievable timetable and deliver on it. Many employers don’t currently collect ethnicity data and so a much longer timeline for policy delivery will be needed; as a minimum an extra year will be needed for employers to begin collecting this data before they could then consider providing a report. This wasn’t a challenge presented with the delivery of GPG reporting. As a first step and before reporting requirements are considered, employers should be mandated to collect this data from their existing workforce. ● ● Lessons from GPG reporting – In addition to asking questions posed within the consultation paper, we also asked members for their thoughts on what lessons could be learned from the delivery of mandatory GPG reporting. ❍ ❍ There needs to be recognition by
| Professional in Payroll, Pensions and Reward | March 2019 | Issue 48 6
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