Accounting technicians support ethnicity pay reporting

A survey of members of the Association of Accounting Technicians (AAT) shows significant support for a requirement of companies to report differences in ethnicity pay among employees

The survey demonstrated that a majority were in favour of the suggestion that an employer that identifies disparities in their ethnicity pay in their workforce should be required to publish an action plan for addressing this issue. More than two thirds (68%) supporting a legal obligation on companies to do this once disparities were recognised.

It was widely believed that there would be benefits for employers in reporting their ethnicity pay information, with 2% of respondents believing financial benefits are the key benefit, 10% believing that company performance would improve and 50% believing that improving social justice was sufficient cause. 21% believed that all three of these benefits will be realised by ethnicity pay reporting.

However, a quarter of members (25%) remained unconvinced of the value of this kind of reporting, with 16% believing that none of these benefits would be realised and 9% not knowing what, if any, benefits would be produced by such a requirement.

As to what form this reporting would take, the AAT said that ‘comparing average hourly earnings of ethnic minority employees as a percentage of white employees does have the benefit of mirroring the gender pay gap methodology’. However, while it supported replicating the successful elements of gender pay gap requirements, it said that ‘in this instance it would not be helpful’. Also recognised as problematic was the suggestion that consolidating ‘various classifications of ethnic minority groups into a single figure’ could be both misleading and ‘could mask significant problems’ such as under-representing one group. The AAT instead supported the ‘relative simplicity’ of publishing pay gap figures for different ethnic groups.

It also noted that contextual data was extremely important in reporting ethnicity pay noting that, for example, the ethno-geographical variation of London ‘means it would be possible to be more diverse than the national average whilst also being less diverse than the community in which the business is based’.

In seeking to combat these issues, the AAT called for a standardised approach, saying that this was ‘clearly enhance consistency’ and avoid either poor reporting or companies providing ‘excessively granular detail’.

The suggestion that all companies with more than 50 employees should be required to produce ethnicity pay reporting was supported by 47% of respondents. One in five (19%) saw the need to go even further, with ethnicity pay reporting requirements being imposed on all companies employing more than 10 people. A 250-employee threshold was supported by 27%.

Phil Hall, AAT head of public affairs & public policy, said: ‘Ethnicity pay reporting could have numerous benefits for employers, employees and the wider economy, as demonstrated by the views of our members.

‘That said, we also recognise that more needs to be done to ensure these requirements are meaningful and lead to sustainable and positive changes.’

The survey of the AAT's of its 140,000 members was conducted in response to a Department for Business, Energy & Industrial Strategy (BEIS) consultation on ethnicity pay reporting. Kelly Tolhurst MP, who launched the consultation, said: 'Reporting ethnicity pay information enables employers to identify – and then tackle – barriers to creating a truly diverse workforce.

'If there is a consistent approach to reporting, they can also benchmark and measure their progress by comparing themselves to other employers and learn from them.'

The BEIS consultation, which closes on 11 January 2019, is here

The AAT response is here

Report by James Bunney

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