King's Speech: Will ethnicity and disability pay gap reporting move the dial on pay equality?

UK companies with 250-plus employees will have to report ethnicity and disability pay gaps under Labour plans laid out in the King’s Speech last week.  

The King also announced a draft bill that would extend full equal pay rights to ethnic minority and disabled workers.

Under existing law, women are afforded more stringent protections than other groups. Gender pay gap reporting has also been in force since 2017, but the Conservative government declined to introduce similar reporting requirements for ethnicity in 2022, saying that it did not want to impose new reporting burdens on businesses and suggesting there would be “significant statistical and data issues” involved.

An analysis by KPMG in 2022 of the impact of gender pay gap reporting suggested that any positive change directly driven by the regulations had been “statistically modest” so far: while the gender pay gap among full-time employees dropped from 9.1% in 2017 to 7.9% in 2021, it was already in decline when the regime was introduced.

So, were the announcements in the King’s Speech enough to move the dial on pay equality? Employment law expert, Louise Taft spoke to Management Today to give her view.

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