Research highlights the fact that a quarter of larger firms are examining the ethnicity pay gap

18 September 2020

Mounting pressure has been placed on the government to introduce mandatory reporting of the ethnicity pay gap in larger firms over recent years. The results of a survey suggest that almost a quarter of the businesses that could potentially be impacted have already begun to calculate the ethnicity pay gap, which means that they will be well prepared should it become a requirement.

Findings by PricewaterhouseCoopers (PwC) show that this is an increase from just one in 10, or 5% of businesses who were monitoring this back in 2018. Additionally, 40%, or two in five, of respondents confirmed that they planned to begin calculating the ethnicity pay gap in their businesses within the next three years.

PwC’s survey included 100 companies, collectively employing over one million people, and highlighted the fact that one in ten, or 10%, of firms were actually publishing their ethnicity pay gap figures voluntarily. This was an increase from 3% who confirmed doing this in 2018.

Two-thirds of respondents revealed that they were now collecting and recording data relating to their workforce’s ethnicity, in relation to 53% who confirmed this in 2018.

The research indicates that the primary reason for not calculating the ethnicity pay gap is because of a lack of data, and the difficulties in collecting data, due to GDPR considerations and concerns about raising sensitive questions relating to race and ethnicity.

The government confirmed that it would make annual ethnicity pay reporting compulsory for any companies who employ over 250 staff, in line with the requirements for reporting the gender pay gap. A consultation was released back in 2018 but no further developments have been announced since it closed in January 2019.


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