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Race to the Top?

Kiran Daurka and paralegal Ian Rajaratnam discuss the independent review by Baroness McGregor-Smith and the government’s response on the hurdles encountered by Black and Minority Ethnic (BME) groups in the workplace

Business women
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Kiran Daurka (pictured) is a partner in the Employment team at Leigh Day where she is assisted by paralegal Ian Rajaratnam. 
“The time for talk on race in the workplace is over, it’s time to act. No-one should feel unable to reach the top of any organisation because of their race.” So reads the conclusion of the government commissioned review into obstacles facing members of the BME community within the workplace. 

There are two particularly troubling aspects to the review’s findings:

Firstly the headline findings, which are sourced from a variety of recent reports examining issues facing BME groups are a damning indictment of how BME groups are treated within the workplace. The findings show the uncomfortable reality that a person from a BME background is likely to face systematic discrimination at every stage of his or her career, even before it has begun:
  • In 2015, 1 in 8 of the working age population were from a BME background, yet BME individuals make up only 10% of the workforce and hold only 6% of top management positions (Business in the Community (2015): ‘Race at work 2015’);
  • The employment rate for ethnic minorities is only 62.8% compared with an employment rate for White workers of 75.6% – a gap of over 12 percentage points. This gap is even worse for some ethnic groups, for instance the employment rate for those from a Pakistani or Bangladeshi background is only 54.9% (Department of Work and Pensions (2015) ‘Labour Market Status by Ethnic Group’);
  • People with a BME background have an underemployment rate of 15.3% compared with 11.5% for White workers. These people would like to work more hours than they currently do (TUC (2016): ‘BAME Workers a Third More Likely to be Unemployed’); and
  • All BME groups are more likely to be overqualified than White ethnic groups but White employees are more likely to be promoted than all other groups (Joseph Rowntree Foundation (2015): ‘Supporting Ethnic Minority Young People from Education into Work’)

Secondly, and presumably most importantly to the business community, Britain is losing out on productivity that it can ill-afford to squander to the equivalent of 1.3% in GDP each year. The review estimates that the economy could benefit by £24 billion per year if BME staff progressed in work at the same rate as their white counterparts. This is surely a powerful incentive for this country to address its workplace inequalities.

Recommendations

The review sets out 26 specific recommendations to mitigate the hurdles faced by BME employees and workers. 

One of the review’s 26 recommendations is that listed companies and all businesses and public authorities with more than 50 employees publish a breakdown of employees by race and pay band. Further the review asks the government to legislate to ensure that these listed companies publish this data. There remains a dearth of data around numbers of BME employees in the workplace, with many employers simply not collecting the data and/or employees reluctant to provide the information.

The government’s response to this recommendation is extremely disappointing (although not entirely surprising) in deciding that the best way to  bring  about this recommendation is a  business –led, voluntary approach” as “a non-legislative approach solution is the right approach for now, but will monitor progress and stand ready to act if sufficient progress is not delivered.”  

It is difficult to understand the government’s approach. We have seen this non-legislative business-led voluntary approach before with gender pay gap reporting. The continued  reluctance by employers to voluntary publish this information has  resulted in the implementation of Section 78 of the Equality Act 2010 which will now require employers with more than 250 employees to publish their gender pay gap data by no later than April 2018. The reality is that without legislation, the systemic race discrimination that still exists within the workplace will not  be properly tackled. There is nothing to suggest that employers will take a voluntary approach to the recommendations of this review. The fact remains that the government must be prepared to legislate if they are committed to eliminating racial inequality within the workplace.

The government is putting concerns about inconveniencing businesses above tackling entrenched race discrimination in the workplace. Last September the Chair of the Equality and Human Rights Commission (EHRC), David Isaac, in response to the EHRC’s own review on the state of race equality in Britain called for the government to implement a comprehensive new race strategy. In responding to that  review, Leigh Day called for the government to introduce mandatory race pay gap reporting alongside gender pay gap reporting as a priority. We once again renew that call and support David Isaac’s recommendation that the government implement a new race strategy. We also urge the government to stop following a tried, tested and failed policy of recommending non-legislative business-led voluntary approaches in tacking discrimination in the workplace and instead comprehensively legislate this matter.

Other sensible recommendations include provision of unconscious bias training at all levels of an organisation; making diversity a Key Performance Indicator encouraging positive action; introducing a guide on talking about race and best-practice.

And how does the government intend to action these recommendations? Interestingly, the government considers that there is merit in developing a guide on how to discuss race at work, ensuring easy access to an on-line tool of best practice and celebrating employers who have a good record of BME employee progression. These are all to be welcomed provided that appropriate consultation is had with relevant organisations and advisers. Over-simplification of race issues at work will be a hindrance, so a mindful approach will be needed.  

The government intends to keep a close eye on “how things develop”, and we need to keep a close eye also to ensure that any on-going failures are recognised and acted upon. The government approach is soft-touch, and it is doubtful what can actually be achieved in a 12 month period given the entrenched problem. 
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