Leaders ask PM for mandatory ethnicity pay gap reporting
In a letter to the Prime Minister, business leaders from the Race Equality Leadership Team at Business in the Community (BITC) are calling for the UK Government to implement mandatory ethnicity pay gap reporting and set targets to improve representation in the workplace.
In response to the UK Commission on Race and Ethnic Disparities report, Sandra Kerr CBE, Race Director at Business in the Community, said: ‘This report was a missed opportunity to confirm the government commitment to implement the McGregor-Smith Review recommendations on mandatory ethnicity pay gap reporting. It is baffling, given the fact that companies have been begging the government for a mandatory duty. 2021 demands so much more than this report. Make no mistake: businesses will keep asking the PM to do better.’
The letter issues a call to action from business leaders on the BITC Race Equality Leadership Team for the Prime Minister to:
- address the structural barriers that remain which limit opportunities for ethnic minority groups in employment and progression
- urge the UK Government to implement mandatory ethnicity pay gap reporting
- set targets to improve representation in the workplace by reference to Office for National Statistics (ONS) Census ethnicity groups
- encourage the UK Government to work with businesses to shape recruitment processes so they are more inclusive to underrepresented ethnic minorities
- ask the UK Government to lead a push for businesses to have more diverse leadership boards.
The letter adds: “We welcome the government’s desire to support enterprise and entrepreneurship. We would expect the government to lead from the front on this, through its procurement and supply chain activity, to ensure Black and ethnically diverse led businesses are included within preferred supplier lists and to invest within local communities by encouraging inclusion in local procurement from small businesses.”
The letter was signed by:
- Amanda Mackenzie OBE, Chief Executive, Business in the Community (BITC)
- Sandra Kerr CBE, Race Director at BITC
- Richard Iferenta, Chair of BITC’s Race Equality Leadership Team, Vice-Chair and Partner at KPMG
- Albertha Charles, Partner, PwC and member of BITC BITC’s Race Equality Leadership Team
- Carmen Watson, Chair and Managing Director, Pertemps Ltd and member of BITC’s Race Equality Leadership Team
- Claire Camara, People Director for Organisational Effectiveness, The Co-operative and member of BITC’s Race Equality Leadership Team
- Jig Ramji, member of BITC’s Race Equality Leadership Team
- Manroop Khela, Head of Specialist Business Units, Santander and member of BITC’s Race Equality Leadership Team
- Mark Chapman, General Counsel Nationwide and member of BITC’s Race Equality Leadership Team
- Naeema Choudry, Partner, Eversheds Sutherland (International) LLP and member of BITC’s Race Equality Leadership Team
- Shaheen Sayed, Senior Managing Director Head of Technology Accenture UK and Ireland and member of BITC’s Race Equality Leadership Team
Erin Johnson, Press Officer at BITC, Erin.Johnson@bitc.org.uk; 0771 310 1878
- The 2017 McGregor-Smith Review called for ethnicity pay gap reporting to be introduced and Business in the Community (BITC) has been asking the government to take action ever since. The review found that race equality in the UK will potentially bring a £24 billion per year boost to the UK economy – 1.3 % GDP or £481 million a week
- BITC’s hundreds of member companies have shown us that, without the evidence, we cannot combat bias (conscious or unconscious) and disparities in our places of work – the scale of which has been laid bare by the pandemic. Last October, BITC wrote to the Prime Minister with over 30 business leaders, asking him to introduce a mandatory duty on pay gap reporting. The business leaders said: “our message to you today is simple: we don’t see this as a burden”.
- Voluntary pay gap reporting is not enough:
- The BITC’s Race at Work Charter Survey Report 2020 report shows that 60% of companies monitor data on pay and ethnicity but only 30% of companies publish data on pay and ethnicity.
- BITC’s research in 2020 showed that voluntary reporting does not last: the number of companies reporting on their gender pay gap halved due to the 2020 suspension, despite the fact that many companies had already gathered the data.
- BITC’s 2020 Black Voices report revealed that:
- 74% of Black employees want to progress in their careers compared to only 42% of white employees
- 33% of Black employees feel their ethnicity will be a barrier to their next career move, compared to only 1% of White employees
- Current Office for National Statistics (ONS) data shows that only one in 16 people at senior levels in the private and public sector are from a Black, Asian or minority ethnic background.
- Despite controlling for educational achievements almost 40% of Black African graduates are in non-graduate jobs, double the rate of White British graduates at 20%.
- The economic impact of COVID-19 is already highlighting the increasing disparities in youth unemployment, a pattern identified in the wake of the 2008 financial crisis, the Black, Asian and minority ethnic population experienced higher unemployment, lower earnings, lower self-employment rates and higher housing costs than the White population.
- In collaboration with Business in the Community (BITC), Hogan Lovells produced a Guide for General Counsels, which debunks legal myths around ethnicity pay gap reporting, such as concerns over GDPR, increased discrimination claims and reputational consequences.
- The Race at Work Charter 2020 survey report found that whilst 60% of employers were capturing ethnicity pay data, only 30% were publishing it. To get a clearer picture, the Race at Work 2021 Survey launched last month, urging employees to respond about their company’s ethnicity data and pay. This year’s survey is a prime opportunity for employees across the UK to have their voices heard and shape the future of race at work.
About Business in the Community
Business in the Community (BITC) is the oldest and largest business-led membership organisation dedicated to responsible business. We were created nearly 40 years ago by HRH The Prince of Wales to champion responsible business.
We inspire, engage and challenge members and we mobilise that collective strength as a force for good in society to:
- develop a skilled and inclusive workforce for today and tomorrow
- build thriving communities where people want to live and work
- innovate to sustain and repair our planet.
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