Employers told to ‘hold themselves accountable’ for ethnicity pay gaps

Campaigners call for more businesses to collect race pay data and improve transparency around issues of discrimination

Businesses need to be more transparent about their ethnicity pay gaps and how they are tackling discrimination in the workplace, Business in the Community’s (BITC) campaign director for race equality has said. 

Sandra Kerr said employers needed to “hold themselves accountable” about issues of race discrimination.

“In order to achieve a fairer workplace in the UK, we need to encourage all employers to hold themselves accountable and to be transparent about where they are and what direction they are headed,” she said.

But Kerr added that many employers were still “hesitant” to speak publicly about their ethnicity pay gap.

After the successful rollout of gender pay reporting in 2017, which required larger employers to gather and publish data their gender pay gap, a similar move around compulsory ethnicity pay reporting was expected to happen next year; however, the government is yet to announce any action on this.

A consultation on how ethnicity pay reporting might work was launched by Theresa May’s government, and closed in January, but the results have yet to be released.

According to a poll by BITC of 108 employers already signed up to their Race at Work Charter, nearly two-thirds of employers (63 per cent) monitored data on pay and ethnicity, a 2 percentage point increase on 2018. However, just 31 per cent – less than half of those collecting data – were choosing to publish their pay gap statistics.

In the survey, 97 per cent of firms reported having a clear zero-tolerance policy on racial harassment and bullying, and 98 per cent encouraged employees to call out bullying and harassment in the workplace. However, just 45 per cent of companies surveyed reported opening a review into racial bullying and harassment in the workplace.

But Dr Zubaida Haque, deputy director of race equality think tank the Runnymede Trust, said the problem with zero-tolerance policies were that they depended on individuals coming forward and reporting incidents.

“Bullying manifests in all sorts of ways, so it doesn't matter if a workplace says 'we have zero tolerance towards bullying'. If they're not identifying the different kinds of bullying then it doesn't really address the problem, and it certainly doesn't address the problem for particular groups that are more likely to experience bullying.”

Haque added that the discrimination experienced at work often wasn’t overt. “A lot of it is micro-aggressions: small slights, comments that are meant to be jokes but aren't really jokes and actually fundamentally challenge their sense of belonging,” she said.

Claire McCartney, senior resourcing and inclusion adviser at the CIPD, said employers needed to do a “much better job” of combatting racial harassment and discrimination in UK workplaces. “There isn’t a silver bullet to building a diverse and inclusive organisation, and one solution will not work for all,” she said. 

“HR has a key role in calling their organisation to account on culture, leadership and people practices and policies, including recruitment, development and progression. Doing so will help businesses to reap the benefits that come from having a diverse range of ideas, perspectives and ways of working.”

The BITC survey also found 68 per cent did not ensure racial diversity on interview panels, with just 29 per cent having consistently racially diverse panels for promotion interviews.

Only 2 per cent of private sector organisations have targets to increase the racial diversity of their board and senior executive teams, in contrast to 62 per cent of public sector organisations.

The companies surveyed represent 1.3 million UK employees, 32,000 of which were managers with an ethnic minority background. 

According to data published by the Office for National Statistics this summer – which looked at the pay gap across the economy, opposed to within individual companies – white workers earned 9.2 per cent more in hourly earnings than black British or black African or Caribbean workers in 2018.

Pakistani workers earned on average 16.9 per cent less than white British workers, and Bangladeshi workers more than a fifth less (20.2 per cent). 

However, Chinese workers earned more than 30 per cent more than their white British counterparts, and Indian employees 12 per cent more. The ethnicity pay gap was starkest in London, where white workers earned 21.7 per cent more than those from an ethnic minority group.