Could mandatory disability workforce reporting help to tackle pay disparity?
Listed firms in the UK are already obliged to disclose their gender pay gaps, but the government is proposing to extend this requirement to cover disabled and non-disabled staff
A disabled person working in the UK was paid 13.8% less on average than their non-disabled counterpart last year, according to the Office for National Statistics (ONS).
Given that this country is home to 14.6 million disabled people – of whom roughly a third are in work – it’s clear that disability discrimination in employment remains a significant problem. Yet, while there have been concerted efforts to close the gender pay gap, the difference in remuneration between disabled and non-disabled employees has tended to go under the radar.
Caroline Casey is the founder of The Valuable 500, a coalition of CEOs who have pledged to improve disability inclusion. She says: “For far too long, disability has been invisible in comparison with other minority concerns. Over and over again, the statistics show how disabled workers are consistently being overlooked and underserved.”
In an attempt to address this problem, the government has held a consultation to collect views on voluntary and mandatory disability workforce reporting. Its full findings were scheduled to be published in June, but the results have yet to be formally announced.
Speaking before the consultation began in December 2021, the minister for disabled people, health and work, Chloe Smith, outlined the government’s aims. “We want to support employers to have the right information, so they can take the steps needed to make their organisations inclusive for all,” she said.
Despite Westminster’s belief that greater transparency could help to reduce the disability pay gap, views among employers and disabled people are mixed when it comes to whether mandatory disclosures would have the desired impact.
Casey says: “Reporting is not a magic wand. It would catch only the number of disabled people who are employed, not those who may have lost employment or be looking for work.”
Issues concerning reporting and individual identity further complicate matters. More than half of employers (52%) have reported problems collecting data on disability. The fact that 80% of disabilities are invisible – and that many disabled people choose to hide their condition – is one reason for this.
“There is also a lack of consensus worldwide regarding the definition of disability,” Casey notes. “But we shouldn’t underestimate the need for employees to self-identify without fear of negative repercussions, of course.”
Holding companies accountable
Other experts are more confident about the likely effectiveness of compulsory disclosures. Steve Ingham, CEO of PageGroup, is a wheelchair user and an advocate for mandatory reporting on disability. He believes that it would “ensure inclusion of people with disabilities in the workplace”.
Ingham adds: “The only way to drive change is to hold companies accountable. Measurement is crucial when it comes to closing the gap, but this will provide truthful data and actionable insights only once the work environment feels inclusive and employees are comfortable expressing their disability.”
Acknowledging that reporting is not the only solution, Ingham observes that the transparency and open culture at PageGroup has helped to empower more of its employees to talk about their disabilities at work.
The Chartered Institute of Personnel and Development supports the proposed move towards compulsory disclosures as part of the wider need to “drive genuine change” in how employers treat disabled people.
But its senior policy adviser on resourcing and inclusion, Claire McCartney, warns that employers must be prepared to report effectively. The risk is that it becomes a mere compliance exercise.
She says: “We’re concerned that a mandatory approach could encourage organisations to adopt a superficial tick-box attitude rather than developing practices that lead to lasting improvements. Many organisations lack the systems and infrastructure to collect data effectively on disability and long-term health conditions. Such data is meaningful only if it is understood and acted upon to inform real, sustainable change.”
Such criticism could be levelled at the Equality Act 2010 (Gender Pay Gap Information) Regulations 2017. Despite having submitted mandatory reports for five years, many businesses have made little progress in closing their gender pay gaps. In some cases, these have even widened.
“Gender and racial inequalities remain rife in the workplace, despite the introduction of reporting,” Casey says. “Enforcement bodies simply don’t have enough resources. Consequently, many firms do not report. We need to get to the root of the problem to build better and faster.”
How can businesses close the disability pay gap?
One of the challenges for employers is to find a reporting method that accounts for the wide range of disabled experiences and identities. One of the issues arising from the government’s consultation is the fact that mandatory reporting would require ministers to decide on a definition of disability and the categorisations of types of disabilities and conditions.
This is particularly pertinent given that the disability pay gap varies depending on the type of disability and the number of conditions an individual may have.
Xavier Langlois is chief legal and impact officer at Beamery, a talent management platform. He says: “For the employer, the challenge will be to report in a consistent, anonymised way and remain mindful that data-capture requests could cause disclosure issues for those employees who aren’t comfortable that their employer has access to their sensitive information.”
Some respondents to the consultation have also expressed concern that making such measurements mandatory could contribute to “the impression that disability is ‘hard work’ and a ‘hassle’”.
McCartney says: “For real progress to be made, employers must take a systemic approach to ensure that their organisations are inclusive to disabled people and those with long-term health conditions. That involves looking critically at how they operate, from their processes and procedures to their culture and people management practices.”
Although the preliminary results from the consultation suggest that there’s little evidence to support a mandatory approach to disability workforce reporting. Langlois believes that such a measure could draw more attention to the problem and “force some employers to adjust their behaviour”.
What many disabled employees want to see are improvements to inclusion at work and a focus on their experiences, rather than just the reporting of figures. Whether new rules are imposed in this area or not, Casey believes that closing the disability pay gap requires a wholesale change of attitude among UK employers.
“I don’t think mandatory disability workforce reporting is the key to closing the employment gap,” she says. “We need to work closely with businesses to create more inclusive workplaces and to cultivate cultures of trust.”