What about the Ethnicity Pay Gap?

The gender pay gap this year marked a milestone on the road to gender equality, as companies with over 250 employees were asked to disclose their average pay for men and women, including any bonuses.

As predicted, the figures did not paint Britain’s largest companies in a favourable light, with 78 per cent of the 10,015 firms reporting a wage gap in favour of men. Addressing the issue, the Prime Minister warned that the genderpay gap was a “burning injustice” which would ultimately make us a “poorer society if outdated employment practices weren’t tackled swiftly.

While new legislation forces employers to restore gender balance to their business, depressing new figures have revealed a stark disparity in the pay of ethnic minority workers and their white, British counterparts.

In 2016, the Trade Union Congress analysed figures from the Office of National Statistics and found that black graduates are on average earning ￡4.33 less than white graduates. The study further indicated a vast divide between all black, Asian and minority ethnic (BAME) workers with degrees and white graduates, with a startling pay gap of 10.3% - the equivalent of ￡1.93 per hour.

Then, in 2017, a report from the Equality and Human Rights Commission (EHRC) revealed a significant pay gap between Bangladeshi and British men in equal roles of 48%.

The findings uncloak a harsh reality: despite the level of education achieved, BAME workers are still at a systemic disadvantage, typically earning less than white workers regardless of the hours they put in. It’s clear that race still plays an unwelcome role in determining employee pay; that discrimination still exists at the heart of many British businesses, from small start-ups and growing enterprises to household names.

Even professional services firm Deloitte has admitted to paying their Black, Asian and Minority Ethnic employees in the UK 12.9 per cent less on average per hour than their non-BAME workers.

Now, the Trade Union Congress are calling upon the government to urgently develop a race equality strategy akin to new legislation surrounding gender pay gap reporting.

In turn, The Department for Business, Energy and Industrial Strategy has since commissioned new research into black, Asian and minority ethnic (BAME) participation and progression in the workplace on the back of the independent McGregor-Smith Review last year, which found that the UK economy would enjoy a boost of ￡24bn a year if BAME workers received the same opportunities as white employees.

However, if we as a nation are to reduce the ethnicity pay gap and create a fair environment where workers of all backgrounds can thrive, business leaders absolutely must not wait around for a government-imposed deadline!

Instead, action needs to be taken immediately, to identify the cause of the wage disparity in order to tackle the problem head-first before the gap can grow wider. In their recent report, the EHRC outlined a range of suggestions for government, society and business to take on board in our efforts to improve diversity and inclusion across the board.

Of these recommendations, perhaps the most actionable point for business leaders is to reduce prejudice and bias in recruitment, promotion and pay. According to their research, employers are still heavily influenced by the characteristics of an individual when hiring new staff, determining salaries and deciding who will be given “the nod” to rise to the top of the ladder.

It also found that job applicants with supposedly ‘foreign’ or ‘ethnic’ sounding names received 29% fewer expressions of employer interest than those with British sounding names, despite both resumes being identical in skill and experience.

It’s an underlying issue that we have so far allowed to linger and grow in workplaces across the country; a problem that has already caused significant damage and continues to impact on the lives of thousands each day. The time to act is now: until employers stamp out unconscious bias and interpersonal discrimination within their own company culture, non-white workers across the UK will not receive the fair job opportunities they deserve.

Our mission is to champion talent from all walks of life, to combat the lack of diversity and inclusion in the workplace, and reduce this ethnicity pay gap.

Contact us today to see how we can help you recruit the highest quality talent, for your business.