Eliminating ethnicity-based pay inequity – it starts with data
Employers are becoming more transparent and proactive when it comes to unequal pay. Following the upsurge in gender pay gap reporting and analysis, ethnicity is another area of concern for a host of businesses. Those who respond quickest and most impactfully stand to gain significant momentum in the eyes of current and future employees, as well as competitive advantage in the eyes of would-be clients or customers. And it all starts with the data.
Closing the Gap
In 2020, the mean UK ethnicity pay gap between BAME and non-BAME staff was 29.3%
Improved Financial Performance
Companies that have racially and ethnically diverse employees are 35% more likely to financially perform above their industry’s average.
Thorough + transparent
Moving beyond reporting on the ethnicity pay gap
Organizations and their leadership teams are rightly under pressure to be more reflective of the society and consumer bases they serve. More equal pay and representation stands to unlock a host of business benefits, from increased staff retention, belonging and wellbeing, to better insights into the diverse needs of their customers.
According to PwC, 23% of businesses were already calculating their ethnicity pay gap in 2020, up from just 5% in 2018. But what comes next? More action is needed — grounded in thorough data analysis that can be used to drive more effective decision-making.
Practical + proactive
Take informed, meaningful strides to break the ethnicity pay gap
Work with our team of EDI experts and you’ll feel more confident about raising the ethnicity pay gap problem, gathering the relevant data, and asking questions around race within your organization. We’ll also work with you to set robust performance objectives, ensuring that pay equity is embedded in the wider strategic decision-making process. These goals may also include activities to:
- Recruit more inclusively and free from bias
- Champion race within the organization
- Establish mentoring or sponsorship arrangements
- Foster a spirit of allyship across the business
- Address workplace bullying and harassment concerns
What our clients say
Ethnicity Pay Gap FAQs
What is the ethnicity pay gap?
The ethnicity pay gap is the difference in average pay between workers belonging to different ethnic groups. This usually refers to the lower rates of hourly pay provided to remunerate black, asian and other minority ethnic employees for their work in comparison to those that are ‘white’. There is a growing move to assess the EBPG (ethnicity bonus pay gap) as this is often patterned in relation to ethnicity.
Why is there an ethnicity pay gap?
The primary reason for the gap is the under-representation of black and minority ethnic staff at more senior pay grades in the corporate hierarchy, paired with their over-representation in more junior and part-time roles that receive lesser pay. Discrimination and prejudice and bias are key elements in this gap. Another contributing factor is the demographic composition of different groups — on average, ethnic minority communities tend to be younger, and young age is generally associated with lower rates of pay.
How can the ethnicity pay gap be reduced?
The ethnicity pay gap is a complicated problem, but there are methods that can help to close the gap. As a systemic issue that disadvantages certain communities, the pay gap can only be tackled by making systemic change.
Companies benefit from auditing their pay data to inform EDI strategy and ensuring that they take positive action to increase Black, Asian and ethnic minority representation in leadership roles to help to close the gap, and in building the capacity of all managers and leaders to understand how to address conscious and unconscious racism in their everyday work.
There are patterns for example in which groups of staff get career development opportunities, and what kind of work is allocated to them, and how much support and encouragement they get.
Dive deeper into diversity, equity and inclusion
Check out our range of posts, resources, and thought leadership on EDI at work.
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