Key role for HR in driving up response rates for ethnicity pay gap reporting

As you may have seen in the news the government has published extensive ethnicity pay gap reporting guidance issued for UK employers. It’s not mandatory, but the government sets out a strong case for voluntary reporting to help to build transparency and trust among employees. The guidance is more extensive than we expected, comprising five separate documents on how to measure, report on and address any ethnicity pay differences within the workforce.

It's application to UK employers is covered in some detail by Susi Donaldson and Shuabe Shabudin in their article for Out-Law. They highlight how the guidance ‘strongly discourages’ binary reporting, and they explain why that approach is a problem because it tends to ‘mask detail and nuance’ which might be vital for understanding ethnicity pay gaps. They also explain the approach needed to collecting and analysing data and ways to avoid a low response rate, which is often an issue. 

On response rates, the guidance suggests that employers should report on the proportion of employees that did not disclose their ethnicity when asked. On that point Susi says: ‘If response rates are low then not only will that lead to the stats being fairly meaningless, but it will also reflect unfavourably on employers as it suggests a general lack of employee engagement. This highlights the importance of investing time and effort in implementing an effective comms campaign to drive up response rates.’

Clearly that is very much HR territory so let’s get a view on it. Earlier I phoned Shuabe Shabudin asked him about that challenge of engaging effectively with employees to ensure a good response rate and so a good data set: 

Shuabe Shabudin: “One of the issues that we often have when clients are coming to us and wanting to undertake this kind of an audit is the risk around the lack of response and, as Susi says, one of the clients’ concerns often is how that is going to reflect on them. So, we always say that it's important for employees to know why they are being asked the questions and what the information is going to be used for. So, when an employer is clear about that, when they're transparent about it, and when they can communicate to employees that this is about group gain for everyone, then we do find that that can increase the response rates and, as Susi said, it would be a shame for people to be put off from undertaking these kinds of ethnicity pay gap reports - and whilst, of course, it’s still voluntary - at the risk of it perhaps being published, or it needing to be published that they had a 25% response rate. I must say that we generally do find, actually, that the response rate for ethnicity pay gap reports and for ethnicity pay gap audits is actually reasonably high and I think that's because the people that are responding to these kinds of questionnaires are often very engaged in it. These are people who have been marginalised, who may have faced difficulties, so when they are given the opportunity to speak their mind, to say their piece, we do find that people take it up but as I say, it's still something that needs to be borne in mind. Comms is a great way of doing it and also, I think, maybe looking at where else the information might be held. So, whilst it might not be in a data set, or on an accounts system that you may already have, it could be a case of interviewing key stakeholders, or interviewing senior people or, maybe, even interviewing people from a range of different roles and levels. So, there's lots of different ways that the information can be obtained.”

Joe Glavina: “This guidance isn’t mandatory, and it hasn’t been widely reported as far as I can see, so why would employers do anything differently? Why not just carry on as they have been doing?”

Shuabe Shabudin: “That's a really interesting question, Joe. I think for those that have already undertaken these kinds of ethnicity pay gap audits on a voluntary basis there isn't much more that they need to do, they will already have been going through the number of different steps that there are and doing the great work, no doubt, as a result of that. Perhaps the only change might be around, as we mentioned, the strong encouragement against binary reporting - a lot of clients that we have worked with have done it on that basis. 

So, I'd say that would be something that they would need to consider. They will already be thinking about the three other areas which I'm now going to mention which I think will be of difficulty, concern and need for particular thought. That would be, as I've just mentioned, what classifications to use, how to classify people. Point number two, how to insure against there being any data protection risks, risks of individuals being identified. Then the third point that we have been asked, and are continuing to be asked about by clients, is that what happens next, the action plan, the D&I strategy, whatever it might be, that then makes all of the effort that's been put in worthwhile. So, those are the three areas, the main three areas, that I think employers that haven't yet conducted this kind of an audit need to be thinking about, and those are also the three points that employers that have already done it still need to think about and certainly one of the main areas that we can help is in relation to the data protection risks, how to mitigate those, and then also working alongside Brook Graham, Pinsent Masons’ in-house diversity and inclusion consultancy, how they can use that information to create that real and positive and lasting change.”

Susi and Shuabe’s article on the government’s guidance as it affects UK employers is called:  ‘Extensive’ ethnicity pay gap reporting guidance issued to UK employers’ and we have put a link to it in the transcript of this programme along with a link to the guidance itself.

LINKS
- Link to guidance for employers on ethnicity pay gap reporting
- Link to Out-Law article: ‘Extensive’ ethnicity pay gap reporting guidance issued to UK employers’