Select committee: Women and Equalities Committee

Fourth report - Ethnicity pay gap reporting

HC 998 Published 8 February 2022

Women and Equalities Committee Ethnicity Pay Gap reporting: One-off Report on parliament.uk ↗

At a glance1 recommendation and 1 conclusion · Government response published 13 May 2022 (deadline 8 April 2022)

The government's response

Summary written by Accountability Index from the government's response. It is not the government's own words.

The Government does not accept the Committee's call for mandatory ethnicity pay gap reporting, saying it "will not be legislating for mandatory reporting" and will instead provide guidance for employers who choose to report.

It has accepted the Commission on Race and Ethnic Disparities' recommendation that ethnicity pay gaps "should continue to be reported on a voluntary basis".
Its stated reasons are that reporting is "just one type of tool" that "may not be the most appropriate tool for every type of employer", and that it does not want to impose new reporting burdens on businesses.
The guidance will cover data protection issues and methods for capturing, analysing and reporting ethnicity pay data, as the Committee recommended, and will support employers to produce a diagnosis and action plan.
The Government says it "committed in 'Inclusive Britain' to publish the guidance in Summer 2022" and will publish its analysis of the 2018 consultation responses "in due course".

Read the government's response ↗ Report an error

What the committee recommended 2

1
The Government has acknowledged that ethnicity pay gap reporting should be mandatory. Conclusion · paragraph 15
2
The Government should introduce mandatory ethnicity pay gap reporting by April 2023 for all organisations... Recommendation · paragraph 16

Sources

Fourth report - Ethnicity pay gap reporting ↗The committee's report, HC 998, parliament.uk
First special report - Ethnicity pay gap reporting: Government response to the Committee’s fourth report of session 2021-22 ↗The government's response, 13 May 2022, parliament.uk

Recommendations and conclusions 2

1
The Government has acknowledged that ethnicity pay gap reporting should be mandatory. Conclusion · paragraph 15 · addressed to Government Equalities Office Conclusion (the committee's words)
The Government has acknowledged that ethnicity pay gap reporting should be mandatory. Businesses are ready for Ministers to follow through on this commitment and bring forward legislation. We recognise that capturing and reporting ethnicity pay gap data is a more complex exercise than for gender, especially given disproportionate sample sizes of ethnicity across the UK. Solutions are available as long as employers are willing, and the purpose of the exercise is clear. Ethnicity pay gap reporting is not about producing a league table or punishing organisations who, due to geographic location, may not have access to the same talent pool. A pay gap is an indicator for employers to identify, understand and address trends in ethnic disparities across their own workforce.
2
The Government should introduce mandatory ethnicity pay gap reporting by April 2023 for all organisations... Recommendation · paragraph 16 · addressed to Government Equalities Office Recommendation (the committee's words)
The Government should introduce mandatory ethnicity pay gap reporting by April 2023 for all organisations that currently report for gender. Legislation should include the requirement for employers to publish a supporting narrative and action plan. The Government should produce guidance, with clear explanations on: (a) data protection to reassure employers how they can legally capture, retain and report ethnicity pay gap data; (b) methods for capturing, analysing and reporting ethnicity pay data; and (c) the body responsible for enforcement and what powers that body will have.