In 2018 the government acknowledged that “it is time to move to mandatory ethnicity pay reporting” for organisations with over 250 employees, after a consultation launched by the Department for Business, Energy and Industrial Strategy.

In April 2023, however, the government shifted its position and instead published the first ever voluntary guidance to help employers measure ethnicity pay gaps in the workforce.

Publishing an Ethnicity Pay Gap (EPG) report is a vital first step in identifying and measuring the scale of racial disparities and tackling institutional racism in any organisation. Mandatory reporting is a robust and rigorous way of driving accountability, transparency and action. It enables trade unions, employers and companies to acquire necessary data to assess the effectiveness of their diversity, equity and inclusion strategies.

It is time for the government to honour its original commitment and require mandatory ethnicity pay gap reporting for companies with over 250 employees.