Scott’s stance: Reporting ethnicity pay gaps creates roadmap to inclusive workplace cultures


This week, professional services organisation Deloitte UK voluntarily reported its ethnicity pay gap for black, Asian and minority ethnic (BAME) staff for the first time, reporting a mean ethnicity pay gap of 12.9% for fixed hourly pay and a mean ethnicity bonus gap of 41.9%.

With gender pay gap reporting building momentum as the first April 2018 deadline approaches and more organisations publish their final reports, forward-thinking employers are taking the bull by the horns and applying the same pay calculations to other minority groups within their workforces.

Deloitte UK is not the first organisation to publish its ethnicity pay gap figures. Fellow professional services firm PricewaterhouseCoopers (PWC) recorded its ethnicity pay gap data as part of its 2017 annual report in September 2017, while EY included its ethnicity pay data as a voluntary addition when fulfilling its gender pay gap reporting requirements in October 2017. PWC recorded a mean ethnicity pay gap of 12.8% for BAME staff, compared to EY’s 17.3% ethnicity pay gap.

All three organisations cite the same reason for their ethnicity pay gap, which mirrors observations around their reasons for the gender pay gap. The organisations each stated that more non-BAME employees hold higher-paid senior roles across the businesses than BAME employees.

The rise in ethnicity pay gap reporting could also be an outcome from the Equality and Human Rights Commission’s (EHRC) Fair opportunities for all: a strategy to reduce pay gaps in Britain report, published in August 2017, which gave recommendations on how governments and employers could address gender, ethnicity and disability-related pay gaps. In particular, the report suggested that employers should voluntarily report their ethnicity and disability pay gaps, including the publication of action plans on how they intend to close any gaps.

In a way, the gender pay gap reporting regulations have empowered employers to investigate pay gaps and pay structures within their organisations, by providing them with a framework or roadmap to produce relevant data. This data can then be used to inform a pay strategy or any measures implemented in order to address potential pay gaps.

The fact that gender pay gap reporting is now compulsory in the UK for organisations with 250 or more employees has also made the issue much more visible, with statutory requirements forcing employers’ hands in making pay gaps a key agenda item.

As employers widen the net of their pay reporting to really delve into the structure of their workforces, it will be interesting to see the steps organisations take towards creating a more inclusive working demographic. Pay gap reporting could, therefore, be the springboard of innovation for diversity and inclusion strategies in the workplace.

Katie Scott