Gender Pay is Done, So What Pay Gap Will Be Next?

blog-publish-date

30 Apr 2018

blog-read-duration

The Gender Pay reporting deadline for organisations with 250 employees or more has been and gone, so what next? Some experts think the next stage will be to ask businesses to calculate and report their Ethnicity Pay Gap, which would explore where there is an identifiable pay gap between different ethnic groups.

What Would an Ethnicity Pay Gap Entail?

The independent McGregor-Smith 2017 review on race in the workplace recommended the introduction of ethnic pay gap reporting to help boost the economy by an estimated £24 billion each year. The reporting regime was proposed as a requirement for employers with 50 employees, with reports showing the breakdown of staff by reference to pay and race. The Department for Business, Energy and Industrial Strategy has tasked the charity Business in the Community with carrying out a review of how many companies are reporting ethnicity pay gaps one-year since the recommendation was released. In response to the review Baroness McGregor-Smith stated: “I believe in order to address the challenges in the workplace on ethnic diversity organisations should report each year on the number of individuals they employ from different ethnic backgrounds and their pay bands. Unless this is done on a voluntary basis now I believe that should be in legislation which will enable every company to understand the extent of the challenge they face on recruiting and promoting BME individuals. Publishing data begins the debate and then having aspirational targets for BME individuals and looking and acting at the underlying challenges in the workplace they face will begin to change the opportunities available to them.”

How Would the Government Bring it in?

It is anticipated that any legal requirement to carry out ethnicity pay gap reporting will take effect along the same lines as gender pay gap reporting, i.e. the obligation will be set on employers who meet a certain threshold and similar calculations will be required. The difficulties with this style of reporting are likely to crop up when employers are required to place each employee within a certain ethnicity. Also, if the requirement is going to be introduced in legislation, the government will have to consider whether the ethnicity pay gap report exists alongside pay gap reports or operates a different schedule, for example, whether the ‘snapshot dates’ for pay data are the same or different.

What Ethnicity Pay Gap Stats are Currently Available?

Some organisations have taken it upon themselves recently to carry out pay audits relating to ethnicity. The Greater London Authority (GLA) group carried out a pay audit in 2018 which found high ethnicity pay gaps across public sector organisations, including a finding that median hourly pay for white employees was 16.7% more than the median hourly pay for black and minority ethnic employees in the Metropolitan Police Service. The highest pay gap was 37.5% at the Old Oak and Park Royal Development organisation, whilst the lowest was 0% at the London Fire Brigade. London Mayor, Sadiq Khan, pledged immediate action to close the pay gap.

What You Can Do Now

Even though there is no obligation currently, employers can take proactive steps to review their pay practices across the whole of their organisations, not just in relation to gender. Ethnicity pay audits can be carried out to identify whether a pay gap exists, whilst being transparent and upfront with members of staff about the audit will demonstrate the employer’s commitment towards fair pay practices. If pay gaps do exist, a plan can be put in place of how these will be addressed, for example, by making changes to the recruitment process, introducing training schemes and assessing whether unconscious discrimination is present in decision making processes.

Gender Pay Support

For more information regarding gender pay reporting download our FREE White Paper, click here. If you require expert support please contact Croner Reward. After you send us your pay data, we will analyse and provide a statistical outcome – determining if you have a gender pay gap or not. We can then advise on how to close the gap, or advise on ways to keep it closed if there isn’t one. Call 0808 145 3385 to speak with one of our pay & benefits experts today.

Free to Download Employer Resources

  • Pay Awards & Forecast (September 2018)

    FREE DOWNLOAD

    Pay Awards & Forecast (September 2018...

    Read Croner Reward's expert settlement and forecast report for September 2018

    Read more
  • Sample Health & Safety Policy Statement

    FREE DOWNLOAD

    Sample Health & Safety Policy Stateme...

    Here we’ve included a free sample Health & Safety Policy Statement that UK business owners can refer to.

    Read more
  • Pay Awards & Forecast (June 2018)

    FREE DOWNLOAD

    Pay Awards & Forecast (June 2018)

    Read Croner Reward's expert Settlements and Forecasts report for June 2018

    Read more
  • How Much Does Employee Turnover Cost Your Business?

    BLOG

    How Much Does Employee Turnover Cost ...

    A recent Glassdoor survey revealed that almost 35% of hiring professionals expec...

    Read more
  • Staff Turnover: What Do You Need to Know?

    BLOG

    Staff Turnover: What Do You Need to K...

    Having a high worker turnover can have mean two things: A negative impact on you...

    Read more
  • What is Wrongful Dismissal?

    BLOG

    What is Wrongful Dismissal?

    If you breach an employee’s contract, you could be liable for wrongful dismissal...

    Read more
  • bemrose-school-derby

    CASE STUDY

    Bemrose School Derby

    “Having Croner-i saves us a lot of time and money, as we do not have to use cred

    Read more
  • wmtr

    CASE STUDY

    WMTR

    “I’d definitely recommend the Croner OnSite services and I have done already, I

    Read more
  • certikin

    CASE STUDY

    Certikin

    “Our Distribution Manager had a particularly technical query relating to respira

    Read more

Ready to focus on what you do best?

Get your free consultation and speak to an expert today.