Baroness McGregor-Smith's 2017 "Race in the Workplace" report recommended mandatory ethnicity pay reporting by £20,000 pay band. The government's response indicated that it would give business an opportunity to report voluntarily, but stood ready to act if necessary. In light of recent figures indicating that only 11% of employers collect ethnicity pay data, the government has issued a consultation paper on mandatory ethnicity pay reporting.

The paper includes a range of legal and practical questions, including in relation to:

  • Whether employers should be required to report ethnicity pay gaps as a single figure, by different ethnic groups, and/ or by pay band or quartile;  
  • How far employers collect ethnicity data for employees at the moment and if so, by reference to which ethnicity classifications;  
  • What steps employers can take to encourage employees to report ethnicity data and how non-reporting should be taken into account in the pay gap information employers will be required to report; and  
  • Whether the obligation to report should be limited to employers with 250 or more staff, reflecting existing gender pay gap reporting requirements.

The consultation closes on 11 January 2019.