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disparity exists, something the BBC acknowledges within its report this year which reveals that the BBC’s ethnicity, disabled, part-time and LGBTQ+ pay gaps already sit within their +/- 3% target. But the BBC is unusual in publishing these results as only three per cent of large companies have voluntarily revealed their disability and ethnicity pay gaps so far. This fact is not lost on the Equality and Human Rights Commission (EHRC) which, in its research report published in August 2018, identifies significant economic benefits to decreasing pay gaps. The report suggests that improving the employment rate and workplace progression for people from ethnic minorities could contribute £24 billion to the UK’s gross domestic product per year; and raising the participation of disabled people could reduce the annual £100 billion cost of people being out of work. This year the ONS has, for the first time ever, analysed ethnicity pay gaps in Great Britain, using newly reweighted earnings data from the Annual Population Survey . It’s inaugural report reveals that Chinese and Indian ethnic group workers have higher average earnings than their white British counterparts but the data shows that all other ethnic groups have lower wages than white British workers with employees in the Bangladeshi ethnic group having the largest pay gap, earning 20% less than white British employees. On average, ethnic minorities earn 3.8% less than white ethnic groups. The EHRC is working to extend the focus from gender pay gaps and make employers aware of the drivers of inequality in work for some ethnic minority groups and disabled people. Employers collecting data on ethnicity
and disability, including on employment and pay gaps, will help the measurement of any inequality. Because, as the BBC highlighted in its report, the aim of measuring pay gaps is not just to assess the size of pay gaps but also to understand how they have come about and identify potential solutions to addressing both the causes and the resulting pay gaps. Once we can understand the causes of differences in pay, which will be different across gender, ethnicity and disability, this can help employers to address pay gaps.
employers do collect ethnicity data, employee ethnicity declaration rates can be below 50% and many employers report that their workforce expressed concerns about how the data would be used. There are many factors behind this. The EHRC found that in terms of collecting data on employees’ ethnicity, just under a third of employers stated that collecting the data is too intrusive; 27% reported that employees do not want to share the information; and 20% stated that collecting it is too onerous. And once collected, analysing ethnicity data can be complex because identifying as a member of a particular ethnic group is self-defined by the individual themselves and is therefore subjective. Some individuals report that they have difficulty completing questionnaires which ask for their ethnic identity because they do not associate themselves with any of the categories or because they associate themselves with more than one category. Will disability pay reporting follow? The EHRC research found that reporting on the disability status of the workforce is less common than reporting a worker’s ethnicity, but when it does occur employers tend to use binary categories (disabled and non-disabled). This is often because of concerns around confidentiality and the need to avoid identifying individuals in reporting. The organisations that are most successful in encouraging staff to share information on ethnicity and disability put significant effort into encouraging employees to provide information and explaining how they will use the data.
...employers report that their workforce expressed concerns about how the data would be used
It is against this background that the government published its consultation on ethnicity reporting in autumn 2018; at the time of going to press we are still awaiting the government’s response to the consultation. However, there are a number of challenges around collecting, analysing and reporting ethnicity pay information in a meaningful way, not least that there is no legal obligation for individuals to disclose which ethnic group they identify themselves with or on employers to collect ethnicity information. EHRC research found that 60% of larger employers (250+ employees) collect data on ethnicity. But even when
| Professional in Payroll, Pensions and Reward | October 2019 | Issue 54 34
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