Earlier this month the government published new guidance on ethnicity pay gap reporting. This was the first government document to set out a consistent approach to measuring pay differences between ethnic groups. Unlike gender, ethnicity pay gap reporting is not a legal requirement, many organisations may choose to publish this data alongside their gender pay gap reports but they don’t have to.

What does this mean for our industry? How should this be implemented? And, moreso, how do we actually go about successfully tackling the issue of the ethnicity pay gap?

Since mandatory gender pay gap reporting was introduced in the UK in 2017, there have been some positive outcomes. Whilst you can’t compare gender and race in a like for like way in this context (and I’ll come to why later), it’s super important that the industry keeps eyes on the prize with this one; the learnings from gender pay gap reporting helps illuminate not just why it’s the right thing to do - but why it’s also good for business.

First and foremost, the introduction of gender pay gap reporting served to highlight the scale of the issue. The data unequivocally showed that, on average, women are paid less than men across almost every industry and across all levels of seniority. The irrefutable facts helped to stimulate discussions about the causes of the gender pay gap and what can be done to address it. Same-same for ethnicity pay gap.

Gender reporting rightly puts pressure on companies to take action to address the pay gap. Many companies have thus implemented new policies and initiatives to promote gender equality and reduce pay disparities. This includes championing flexible working, reviewing recruitment practices, and providing unconscious bias training. All good stuff.

Transparency drives change

Most importantly though, mandatory gender pay gap reporting has held companies accountable; the data is publicly available for all to see, which means that employees, customers, and investors can see how companies are performing on gender equality. This has created a greater incentive for companies to take action to reduce existing gaps.

But the key thing to factor in here is transparency - transparency helps build trust with employees, customers, and other stakeholders, and trust is the bedrock of any successful business. Without stating the obvious pay gap, reporting highlights any disparities in pay and encourages businesses to take a longer, harder look at themselves and to take steps to improve diversity and inclusion. These actions can help to both attract and retain a more diverse workforce (these are two of the biggest things we hear are needed through our People Like Us network).

So - yes, obviously lots of progress made through the implementation of mandatory gender pay gap reporting - but there are some distinctions to understand when you try to apply the same logic to ethnic pay gap reporting:

1. Lack of Consistent Ethnicity Data. While most employers have basic data on their employees' gender, ethnicity data is often incomplete or unreliable. Collecting ethnicity data requires employees to self-identify, which can be both sensitive and complicated.
2. Intersectionality. Unlike gender, ethnicity is just one aspect of a person's identity. Other factors such as age, disability, sexual orientation, and socio-economic background can also affect pay levels. Therefore, ethnic pay gap reporting needs to consider the intersectionality of different aspects of diversity and discrimination.
3. Smaller Sample Sizes. Ethnic minority groups often represent a smaller proportion of the workforce, which can make it challenging to collect reliable data.
4. Complexity of Analysis. Ethnic pay gap reporting is more complex than gender pay gap reporting because it requires a more detailed analysis of the data. The analysis needs to consider various factors such as job roles, levels, and qualifications, as well as regional and industry-specific factors.

Whilst it might be complex, there are still many tried and tested practices such as the use of aggregate data, obtaining consent, protecting confidential information etc, and even if the data is imperfect, it can help identify potential disparities and provide a starting point for further investigation and action.

So: where does that leave us and what can you do?

1. Start doing something, anything! The first step towards addressing the ethnicity pay gap is to gather data on pay and representation across different ethnic groups. Use the government guidance, or use this handy tool that People Like Us have created or (if you're a PR agency) make sure you share your sign up to this brilliant initiative we partnered with PR Week on.
2. Create inclusive hiring practices. Companies should focus on diversifying by creating inclusive hiring practices. This can include targeted outreach to underrepresented groups (People Like Us can help, as can a raft of other organisations), and use ‘blind hiring’ techniques, provide training to hiring managers on unconscious bias etc.
3. Provide equal opportunities for promotion. Companies should ensure that employees from all ethnic backgrounds have equal opportunities for promotion. This can be achieved by implementing transparent promotion criteria and providing training and mentorship programs for underrepresented employees.
4. Address structural inequalities. This is a biggie. Examine your policies and practices to identify any structural inequalities that might be contributing to the ethnicity pay gap. For example, review flexible working policies, parental leave policies, and performance review processes to ensure that they are not disadvantageous to certain groups.
5. Foster an inclusive culture. You can create an inclusive culture by promoting diversity and inclusion through employee comms channels. This can include highlighting success stories from employees from underrepresented backgrounds, providing training on cultural awareness, and celebrating diversity in the workplace.
6. Advocate for change. The marketing and communications industry can advocate for change by working with policymakers, industry associations, and other stakeholders to address the ethnicity pay gap. This can include lobbying for legislation that requires companies to report on their ethnicity pay gap and working with industry associations to develop best practices for addressing the issue.

Addressing the pay gap in our industry will require a concerted effort from companies and industry stakeholders alike. By collecting and reporting on the data, creating inclusive hiring practices, and asking yourselves honest questions around structural inequalities, the industry can make tangible progress towards reducing the gap and creating a more equitable and inclusive workplace.

Find out more about People Like Us here.