Every person, in recognition and respect of their ethnicity and background, should be enabled and empowered to have equal access and outcomes throughout the employee lifecycle – from getting a job, benefit from training to getting promoted and be able to fulfil their fulll potential at work. Employers who take action to ensure equal progression and participation in the workplace, across people from all black and ethnic minority backgrounds, will benefit from attracting and retaining the best people, address skill shortages and improve performance in the process.
Too many individuals from a black and ethnic minority background still face discrimination and disadvantage when trying to get into and progress at work.
Addressing this issue is not just about tackling discrimination; it is also about boosting business performance. It is estimated that in the UK, the economy stands to gain an additional £24 billion if there was full representation and progression across ethnicities in the workplace.
According to the McGregor-Smith Review (2017), the employment rate in the UK for black and ethnic minority groups is only 62.8% compared with an employment rate for White workers of 75.6%. This gap is even worse for some ethnic minority groups; for instance, the employment rate for those from a Pakistani or Bangladeshi background is only 54.9%.
Overall, about 1 in 8 of the working age population are from an ethnic minority background, yet these individuals make up only 10% of the workforce and hold only 6% of top management positions. The Parker Review (2016) of the ethnicity of UK boards found that only 85 of the 1,050 director positions in the FTSE 100 are held by directors of colour.
The CIPD believes that institutional racism remains a significant problem when it comes to employment and progression at work. We have analysed the UK Government’s recent report on race and ethnic disparities and have outlined why we are disappointed by many of findings in a blog post entitled 'The Race Commission's conclusions fail to reflect the evidence and undermine efforts to tackle racism and discrimination in the UK'.
Every person, in recognition and respect their colour and ethnicbackground, should be enabled and empowered to fulfil their full potential at work. The need to create more diverse and inclusive workplaces with equality of outcomes and impact has been recognised but not acted on for too long, and ethnicity pay reporting can serve as a catalyst.
Research published in 2017 by the CIPD showed that there is a significant lack of black and ethnic minority people diversity at the top of UK organisations. Black and ethnic minority employees are more likely than those from a white British background to say they have experienced discrimination, that their career progression has failed to meet their expectations and that they have felt the need to change aspects of their behaviour to ‘fit’ into the workplace.
As well as the cost to individuals of missing out on job opportunities due to prejudice or bias, employers who don’t take action will be left with a more limited talent pool, and inequalities in progression opportunities mean people’s skills will be underused.
The CIPD recently published the Race Inclusion Reports, one of the most comprehensive studies of race equality in the UK. The reports show that there needs to be much more engagement with employees on race equality, data collection needs to be improved, and career progression opportunities need to be fair and transparent.
While there has been some shift in board composition, it has not been to the extent or at the pace required. It is important to build on the success of campaigns that have increased female representation at the top of organisations to make significant strides with ethnic diversity.
The CIPD is actively contributing to UK Government consultations on the issues and supporting employers to drive sustainable change in their organisations. For example, in 2019, the CIPD in consultation with senior level members provided practical recommendations to the UK Government on whether organisations should be required to report on the pay differentials between people from different ethnic backgrounds.
Actions for the UK Government
- Introduce mandatory reporting on ethnicity pay for large businesses with more than 250 employees, based on the same quartiles used for gender pay gap reporting. There should also be a single pay gap figure that compares average hourly earnings of ethnic minority employees as a percentage of white employees.
- Require organisations to produce a narrative and action plan, based on government guidance, as part of ethnicity pay reporting. Progress against the action plan should be included in subsequent reports, to drive tangible change in recruitment, management, development and promotion of employees across all ethnicities.
- Set a timeline for revisiting the impact of ethnicity pay reporting and consult with employers on whether it would be appropriate to provide more detailed data against standardised classifications of ethnicity.
- Advocate and support better quality people management. CIPD research found that people management practice is poor according to all ethnicities.
- Develop guidance for employer action. There is a clear need for practical guidance and case study examples to kick-start and maintain the actions called for in the McGregor-Smith Review, as well as developing better quality workforce data.
- Build the business case for increasing diversity and inclusion in terms of attracting a wider more diverse talent pool and boosting innovation and customer service by developing a workforce that is more reflective of the organisation’s customer base and wider society.
- Identify levels of ethnic diversity using HR data and use this benchmark to explore any structural and cultural barriers that are maintaining workplace inequalities.
- Avoid generalisations: ‘BAME’ encompasses a wide range of backgrounds, cultures and traditions and many different barriers to career progression. We recommend following the Race Disparity Audit’s recommendation, referring to ‘ethnic minorities’ instead.
- Review recruitment practices to eliminate bias and discrimination. This could include how and where employers recruit new workers, whether the images and language used in recruitment materials are inclusive, line manager interview practices and the approach of recruiters working on employers’ behalf.
- Review people processes to retain diversity. Identify barriers in career progression and ‘cliff edges’ where employees leave and address this. Also consider race equality through an intersectional lens such as the combined effects of discrimination experienced because of a persons race,gender, disability and ensure interventions are tailored to addressing multiple barriers and disadvantages.
- Build an inclusive culture. Ensure that race equality is embedded into the organisations vision, mission, values and business plans. Ensure policies and practices are underpinned by race equality outcomes and impact principles that proactively address discrimination and disadvantage including through the use of positive action measures and actively celebrate and encourage difference. Identify whether there are mechanisms in place to enable employees to voice issues about inequality and need for change. Take steps to understand – where the workplace is now (evidencing the baseline), and what could be done to improve inclusivity (action plan).
- Terminology - we advise employers to be sensitive in the usage of language and terminology in relation to race equality and wider equality, diversity and inclusion. This should include engaging and inviting input from staff with lived experience and experts. The CIPD uses the term black and ethnic minority in full to describe all people of colour and minority ethnic backgrounds who experience bias, barriers, disadvantage, and discrimination. We use these terms as they are currently most commonly used. We recognise that no one term will resonate with everyone and respect the uses of other terms where broad categorisations are required. However, we would advise and encourage organisations to be as specific as possible (eg Afghanistan, Bangladeshi, Chinese, Gypsy, Indian, Roma, Pakistani, Nigerian, Somalian, Ukrainian) wherever possible.
- Business in the Community (2018) The Race at Work Survey Report
- Resolution Foundation (2018) Opportunities Knocked? Tackling racial disadvantages and discrimination in the workplace
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