‘Show me the money!’ – Diversity and the Pay Gap

Following on from Part One of our gender pay gap series, in which Catherine Gleave discusses the origins of the gender pay gap, in our latest installment, Esther Adetoba discusses the origins and urgency of narrowing the BME opportunity gap.

Diversity breeds innovation, and innovation promotes growth. This is a notion shared by Baroness McGregor-Smith who states that:

‘If BME [Black and Minority Ethnic] talent is fully utilised, the economy could receive a £24 billion boost.’

It is necessary to promote diversity and inclusion not only in the area of gender but also race, and whilst the conversation around the pay gap has centered on gender, an often neglected area is that of cultural diversity in the workplace. Perhaps it is time we ask ourselves whether there is an ethnicity pay gap in the UK and whether we could be doing more to address it.

The pay gap

There is a scene in the 2016 film Hidden Figures where a black NASA mathematician, Katherine Johnson has to run across the NASA campus, past a number of available bathrooms to a ‘coloured’ bathroom; this was a dramatic scene, and one that demonstrated a blatant inequality. I think it is fair to say that workplaces around the world have made some advances in the area of diversity and inclusion since then. In the UK for example, during the 1990’s only 2% of solicitors were from Black, Asian or other Ethnic Minority (BAME) backgrounds; however the Solicitors Regulation Authority (SRA) highlight the increase in representation in recent years with 14% of solicitors being from ethnic minority groups in 2014 and 21% by 2017. These are positive figures considering ‘11% of the UK workforce were BAME’ in 2015.

Whilst representation in the workplace is improving, an ethnicity pay gap persists. There have been a number of figures circulating due to the recent spike in gender pay activity, however ‘unlike the gender pay gap, there is no one single figure for the gender pay gap of all BAME groups’. The Office for National Statistics (ONS) reported on the ethnicity pay gap for the UK in 2016 and calculated a 5.1% pay gap for BAME groups, and the Greater London Authority’s (GLA) pay report found that BAME public sector employees experienced a median pay gap of 16% compared to White British employees. Additionally, the Fawcett Society reported in 2017 that Pakistani and Bangladeshi women had a pay gap of 26.2% and Black African women saw a pay gap of 19.6% compared with White British men. Although all these figures highlight a definite pay gap, some are clearly more alarming than others. What the ONS figure (5.1%) tells us is that there is some progress. For example in the legal field, of the 21% of solicitors that are BAME, 20% are partners. However the GLA report and the Fawcett Society figures in particular have brought to light large pay gaps: for instance, within London’s public sector the Old Oak and Park Royal Development Corporation had a 37.5% pay gap for its BAME employees.

Sadiq Khan, Mayor of London has been vocal about why he thinks the pay gap exists:

“This is caused by large employers failing to recruit and promote black and minority ethnic (BME) Londoners.”

It is not just the public sector that has been under the microscope, journalists have also been experiencing their own pay gap awakening following the BBC’s 2016/17 Annual Report. As at 2016 ‘British journalism remained 94% white’. In addition, the BBC’s pay report revealed that there were no BAME employees amongst its top 24 earners.

Whilst this is disheartening considering the diverse audience that the BBC caters to, there appears to be a link between the lack of BAME professionals in senior positions and the pay gap across various sectors. The Equality and Human Rights Commission (EHRC) published a research report in 2017 which highlighted that ethnic minorities are over-represented in lower paid jobs and under-represented in higher paid jobs.

This notion was echoed in a 2017 SRA report on Diversity in the legal profession in England and Wales, pointing out that ‘it is much more difficult for solicitors from minority populations to reach the status of partner’ especially considering the ‘double disadvantage’ of race and gender affecting BAME women becoming partners in law firms. Conversely, it would be important to note that we are seeing a marked year on year increase in the percentage of BAME lawyers rising to partner level, that is, from 14% in 2014 to 20% in 2017.
There are flickers of light in the ethnicity pay gap discussion. The ONS and the Equality and Human Rights Commission both note instances where BAME groups had a pay advantage over their white counterparts. The EHRC in particular highlight that by 2014 Black African British women had a large pay advantage, earning 21% more than White British women, however this can be rebalanced with the fact that Female Bangladeshi and Pakistani immigrants experienced a 12% pay gap.

Over-representation in lower paid professions?

In my relatively short career (I am twenty-eight years of age, fresh out of law school) I have had seven managers, only one of whom was male; of the remaining six, two were black women. Recently, I was fortunate enough to sit down with a number of colleagues and I realised that my experience was not a common one. One senior female colleague mentioned to me that whilst she had not felt any outright discrimination either due to gender or race, in her decades of legal practice and publishing she had only had one BAME manager; another colleague echoed this, whilst a number of others said they had never had a BAME manager.

The ONS statistics are a move in the right direction but they must be tempered with an understanding of the statistics and an acknowledgement of some truths: there is still an ‘under-representation [of BAME professionals] in skilled occupations’ and an over-representation in lower-paid roles where there is a pay gap advantage. The pay advantage experienced by some BAME groups is something to be celebrated, but should not diminish the widening gap being experienced by certain ethnic minority groups such as Pakistani and Bangladeshi women. The black security guard, the ethnic minority fast food server and the white CEO: these images are all too familiar and perhaps representative of the types of roles we are accustomed to seeing BAME and white individuals in. These roles are not indicative of intelligence or even qualifications, often times the problem is a lack of opportunity coupled with a lack of confidence.

The legal landscape and the double disadvantage

Within the legal sector and specifically amongst Solicitors, there appears to be a ‘double disadvantage’ for BAME women on account of gender and race. In the SRA report on diversity in the legal profession, white males were still noted as being the most likely to become partners in law firms, with BAME women the least likely. The report further states that:

“...females – and BAME females especially – are disadvantaged when it comes to career progression in the solicitors’ profession.”

In 2017, 21% of solicitors in the UK were BAME, and 20% of partners were BAME. These are encouraging percentages, however when the figures are broken down by the size of the firm we find that on average only 8% of partners in large firms (more than 50 partners) are BAME. The SRA reports that White British males are on average 73.5% more likely to become partners at law firms compared with any other group, with black females having the lowest probability at 13%. These statistics are supported by the Equality and Human Rights Commission who point out, ‘it is possible that the pay gaps develop and increase over people’s careers’, highlighting that ‘three and a half years after graduation’ a pay gap and an employment gap emerge between BAME graduates and White British graduates.

Furthermore, the issues surrounding career progression are not exclusive to law firms and solicitors. Statistics provided by the Bar Standards Board were equally startling: in 2017, only 7.1% (118) of self-employed Queen’s Counsel (QC) were BAME, compared to 89.3% (1,487) of White QCs. Notably the Bar Council are making moves to improve diversity amongst those taking silk ‘particularly for women and ethnic minorities’.

There are a number of reasons why a pay and employment gap could arise following graduation, and why the chances of promotion to senior levels is lower for groups such as black women: it could be caused by lower levels of educational attainment compared to other graduates, an unconscious bias by recruiters, or a lack of opportunity and confidence.

The attainment gap

The issue of educational attainment for ethnic minority students must be tackled if we are to close the pay gap and have a real impact on BAME career prospects. The attainment levels for BAME students are relatively low: ‘66% Asian and 53% black students achieve a 2:1 or above, when compared with their white counterpart (78%)—even though they achieved the same A level grades’. The 2012 Higher Education Academy report speculated that this could be caused by:

…problems of segregation, low teacher expectations, undervaluing or under-challenging of BME students, prejudiced attitudes associated with linguistic competence and discriminatory practice inherent in LTA activities (learning, teaching and assessment) and student support.”

Advance HE’s Race Equality Charter Mark has put forward ideas as to how to address this attainment gap. Many of the points center around the idea of belonging, whether that is by ‘diversifying the curriculum’ so that it is not so focused on White European cultures, or recruiting a more diverse workforce to increase the visibility of high achieving BAME individuals.
As well as low attainment, ‘implicit bias’ at universities has been brought to light in recent years and university admissions processes are being questioned; the University of Oxford, for example, admitted only 45 BAME students in 2016. With many employers in search of employees with qualifications from elite universities it is important that race is not a barrier to success or achievement. If BAME persons are to progress professionally, any bias or disadvantage at an educational level must first be addressed in order to ‘level the playing field’ before graduates embark on their careers.

What can organisations do to improve BAME career prospects?

Discussions around diversity and inclusion cannot merely consist of bridging the pay gap but also increasing the opportunities available to BAME individuals, in particular BAME females. A diversity of thought is necessary in any workforce and can present itself in a number of ways, from different backgrounds to different upbringings and associations. Diversity is necessary around any decision-making table, whether it be diversity in the way of gender, race or disability: effective change can only come about when decisions are representative of the workforce and the communities they are serving. There are a couple of ways that organisations can support BAME progression:

  1. Firstly, many organisations in the UK have implemented ‘name-blind applications’. These remove any of the bias or ‘ethnic noise’ that could arise from seeing the name of an applicant. Mel Nabhrajani, Legal Director, Department of Health and Social Care Legal Advisers, credits her entry into the legal profession to a name-blind application process saying: I don’t think I would have got a tenancy as easily if that hadn’t been the process’. In her case, 4 women were selected for interview following name-blind applications, two of whom were BAME, and the quality of the selected candidate speaks for itself. Perhaps this is something that should be rolled out nationwide.'Additionally, in July 2018 forty-four Law firms in the USA will be involved in phase two of the Mansfield Rule pilot. The aim of this rule is that at least 30% of those interviewed for management and leadership roles should be ‘women, LGBTQ+ and minority lawyers’. These are not requirements to hire a quota of minority professionals, only a requirement to include them in the interview process. This rule was preceded and heavily influenced by the Rooney Rule which did for the NFL what many are hoping the Mansfield rule will do for the legal profession: it resulted in a 20% increase in the likelihood that a BAME coach would be hired as head coach. Opportunity is everything; if opportunity is sparse and an unconscious bias amongst recruiters remains, then we are enabling a society in which BAME professionals are at a disadvantage. The Diversity League Table describes the current diversity and inclusion tactics in many workplaces:“[there is a] frustration with the apparent failure of a ‘laissez faire’ business-case approach, driving calls for a more interventionist policy…”
  2. Maybe it is time for a more mandated method. As it stood in 2016 BAME students were less likely than White British students to be employed six months after graduation; having a blind application process or a Mansfield-esque rule could reduce any biased cause of this. An analysis of the recruitment process is important to help create a truly diverse environment. Catherine Lang-Anderson put it this way:
    “I don’t think diversity ambitions are about giving one group more advantages than others…It’s about levelling the playing field so that the most talented people can progress, no matter what characteristics they happen to have.”

Equality matters, diversity matters and representation matters. The sooner we are able to represent the workforce with more diverse leadership teams, the sooner we can achieve a diversity of thought which is sure to inspire growth. With greater diversity in leadership positions, we are more likely to see a reduced ethnicity pay gap and edge closer to that elusive £24 billion boost to the UK economy.

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