EEF has responded to the Government's consultation on ethnicity pay reporting.
Key findings from a recent EEF survey on ethnicity pay reporting found:
- Whilst almost half (49%) of companies currently collect data on the ethnicity of their employees, two in five (39%) do not currently collect this data and 12% don’t know. What we also found in our discussions with manufacturers is that the collection of ethnicity data is not consistent i.e/ there is no common use of classifications for ethnicity.
- Despite almost half of manufacturers stating that they collect the data, just 8% currently voluntary publish any ethnicity pay related metrics. Almost three-quarters (72%) do not publish any data and one in five (20%) do not know. This chimes with some of the findings within the consultation document itself showing employers’ reluctance to publish the data for a number of reasons. Some companies we spoke to did collect the data, or previously collected the data but did not publish due to concerns about GDPR.
- For simplicity, the majority (65%) of manufacturers want to see ethnicity pay gap reporting (the metrics) mirror the requirements of gender pay gap reporting. Only one in five (18%) disagree and one in five (18%) are not sure. In a similar vein, manufacturers generally want to see the threshold for employers in scope of the requirements to mirror gender pay too. Indeed half (51%) said that employers with more than 250 employees should be in scope. That said, over one in five (22%) believe it should be for those with over 500 employees. Just under one in five (19%) want it to be employers of any size and a handful (8%) more than 50 employees.
- Manufacturers see benefits and challenges to ethnicity pay reporting.. Almost six in ten (57%) of manufacturers agree that ethnicity pay reporting is a good opportunity to benchmark themselves against others. This is a similar message to that we saw ahead of gender pay gap reporting. It was for this reason that EEF published its own benchmark once the deadline had passed so manufacturers can benchmark themselves against others. In addition, over a quarter (27%) of manufacturers feel ethnicity reporting will be easier having undertaken gender pay gap reporting.
- However, there are clearly some challenges. Half (51%) of manufacturers are concerned about the time and resource it will take to collect, analyse and publish the data, and over a third (35%) are concerned that individual employees could be identified.
You can read our full response to the consultation below.