Ethnicity pay reporting: A guide for UK employers

The moral case for pay fairness across all ethnic groups is self-evident. However, the CIPD Pay, performance and transparency 2024 report found that even though 40% of large organisations had carried out ethnicity pay gap analysis not all had published their analysis.

While ethnicity pay reporting has been voluntary up until now, the Equality (Race and Disability) Bill includes a commitment to require all large employers to publish data by ethnicity. The government has completed a consultation on how best to report this information, before it becomes the law, and you can read more about the CIPD response to this consultation. No matter the outcome of this consultation, workplaces can start preparing for reporting. This guide outlines the current guidance around voluntary reporting that can still be followed until any changes come into force. We will update this page once any changes are enforced.

This guide aims to:  

• support employers in publishing their ethnicity pay data by recommending the most appropriate and effective approach to categorising and reporting their data   
• support analysis and use of the resulting information to produce effective action plans to address the ethnicity pay gaps and inequalities revealed.  

To maximise the opportunities and minimise the challenges of ethnicity pay reporting, there are six principles the CIPD recommends:   

1. Align ethnicity pay reporting with gender pay reporting, but recognise the differences.  
2. Remember ethnicity representation is as important as, and strongly linked to, ethnicity pay gaps.  
3. Recognise the value of simplicity and clarity.   
4. Focus on action.   
5. Start and improve.  
6. Combine comparability in data with tailoring of analysis and actions.  

Based on these six principles, the CIPD recommends employers publish annual ethnicity reports based on three key components:   

• A uniform set of eight commonly defined statistics to profile pay by ethnicity.  
• A supporting narrative to explain the nature and causation of any pay differentials and gaps by ethnic group evident in their statistics.  
• An action plan of initiatives defined to reduce and remove any such gaps over time.