Ethnicity Pay Gap

By Katie Carter
03 Oct 2023

Unlike the gender and executive pay gaps, it’s not a legal requirement to report on the ethnicity pay gap in your organisation.

That, however, hasn’t stopped a number of employers from doing so.

The ethnicity pay gap in Great Britain

The official figures

The statistics, released by the Office of National Statistics (ONS) revealed that on average, ethnic minorities earn 3.8% less than white ethnic groups.

However, it was also found that Chinese and Indian ethnic group workers have higher than average earnings than white British employees.

In 2018 specifically, employees from a Chinese background earned 30.9% more than white British employees.

The lowest earners

Who were the lowest earners in 2018?

According to the ONS stats, Bangladeshi workers received the smallest median hourly pay at £9.60 per hour. They were closely followed by Pakistani workers at £10 per hour, and African, Caribbean, Black British at £10.90 per hour.

The highest earners

On the other end of the scale, we’ve got Chinese workers taking the top spot with £15.80 per hour, closely followed by Indian workers at £13.50 per hour.

White British workers are 4th from top with a median hourly pay of £12 per hour.

The gender / ethnicity pay gap crossover

The ONS also released stats that show the difference in hourly pay between men and women from each ethnic group.

We won’t go into detail on each of the gaps here, but will focus on the most significant.

The highest gender pay gap exists within the Indian ethnic group, with a 23.3% difference in average hourly pay between men and women.

The gender pay gap for White British individuals is slightly smaller at 18.5%.

The only ethnic group to have a gender pay gap in favour of women is Bangladeshi. Although the ONS did state that the sample size for this group was smaller, and therefore prone to some inaccuracy.

Regional stats

The ethnicity pay gap has also been split into regional groups.

Splitting the data in this way found that London had the greatest pay gap, and that in all other regions (aside from two), ethnic groups earned less than white workers.

The two regions who has a pay gap in favour of ethnic minorities were the East and North East of the UK.

What do if you want to report your pay gap…

Many businesses have yet to even begin collating ethnicity data, and many organisations that have are reporting a low response rate.

If you’re looking to collect this type of information, first you need to clearly understand the implications with regard to GDPR and other regulations. Employees need to trust their data is being held in confidence.

What’s more—you can’t force staff to disclose personal information, so you cannot make submission of this data obligatory.

To get the required response, employers must ensure that all key stakeholders are engaged in the process, and be clear with their staff about why the information is being requested and what it will be used for.

In order to improve diversity in the workplace and avoid potential pay disparities, you need to understand the situation first.  It makes sense from both an ethical and cultural perspective and could also have a significant impact on business credibility and success.

Organisations should:

  • Have a clear approach to collecting ethnicity data and reporting the results
  • Agree what data will be collected and reported to achieve the best outcome
  • Have a plan in place to address the findings and implement change
  • Understand the GDPR and other legal restrictions around the gathering of ethnicity data
  • Communicate and engage with employees

Expert support

Are you looking to publish and ethnicity pay gap report? Or, do you need assistance with your gender pay gap or executive pay gap reports? Speak to a Croner expert today for support and guidance on 01455 858 132.

About the Author

An Employment Law Consultant is happy to help with any complex issue or matter of concern. Katie is confident in providing a best practice or commercial approach to safely reach the required and desirable outcome. Katie has a retail and hospitality background.

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