PM Boris Johnson’s call this month for a cross-governmental commission to address inequality in the UK has fanned speculation that the government may come under pressure to pass legislation forcing companies to publish their ethnicity pay gap.
In 2017, Ruby McGregor-Smith, a Tory peer, published Race in the Workplace, a government-commissioned review into employment issues affecting Black, Asian and Minority Ethnic (BAME) groups in the UK.
The report found that while 14% of the working age population were from a BME background, they made up only 10% of the workforce and held only 6% of top management positions.
“In many organisation, the processes, in place, from the point of recruitment through to progression to the very top, remain favourable to a select group of individuals,” the report said.
Ethnic pay gap
The recommendations to come out of the report covered such things as: improve data transparency; the publishing of aspirational targets; unconscious bias training for hiring managers; mentoring programmes, transparency about career pathways and; more diverse job interview panels.
In its response, the Government said: “The majority of your recommendations are for employers; the Government encourages all employers to adopt your recommendations to make the workplace more inclusive,” leaving it to businesses to implement changes.
One recommendation urged for changes to the law: “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.”
On this point, the Government said: “We believe that in the first instance, the best method is a business-led, voluntary approach and not legislation as a way of bringing about lasting change.
“We believe the case you have made in your report is compelling and expect businesses will want to comply. We, therefore, believe a non-legislative solution is the right approach for now but will monitor progress and stand ready to act if sufficient progress is not delivered.”
This month, McGregor-Smith weighed into the Black Lives Matter debate urging Boris Johnson to implement its recommendations. She told the Financial Times: “The big gap is ethnicity pay reporting . . . and that needs to change.”
Gender pay reporting for large companies and the public sector has been the law in the UK since 2018.
This month, a Government petition to make ethnicity pay gap reporting compulsory exceeded 100,000 signatures, triggering consideration for a debate in Parliament, for a date not yet scheduled at the time of going to press.<