Memorandum submitted by Business in the Community (E 56)

 

Context:

 

Business in the Community (BITC) works to inspire, engage, support and challenge companies on responsible business in order to continually improve their positive impact on society.

 

Membership of BITC is an active commitment. Our 850+ members recognise the relationship between their company's values and responsible business practice and the role this plays in creating wealth, building trust and addressing social need. A further 3000 companies are engaged through our programmes and campaigns which we operate through a local network of more than 100 business led partnerships. In addition, we convene a 'Global Partners Network' of 112 organisations operating in 60 countries.

 

BITC's operates two major diversity campaigns, Opportunity Now (gender) and Race for Opportunity (race).

 

Opportunity Now empowers employers to accelerate change for women in the workplace - because it makes good business sense. Opportunity Now works with its membership of 350 employers, from the UK's largest to some of the smallest in the private, public and education sectors.

 

Race for Opportunity (RFO) is committed to improving employment opportunities for ethnic minorities across the UK. RFO raises awareness of the barriers preventing ethnic minorities from making progress in the workplace, and communicates the need to introduce policies and practices that improve Black and Minority Ethnic (BAME) representation in the UK workforce.  It is the only race diversity campaign that has access to and influence over the leaders of the UK's best known organisations and has a membership of 170 employers, from both the public and private sectors.

 

Background

 

We have consulted with our members on the Single Equality Bill in order to ensure that this legislation is workable, and are engaged in discussions with both the Government Equality Office and the Equality & Human Rights Commission over specific elements of the Bill.

 

This paper takes a wide perspective and does not put forward specific proposals/amendments. It does however outline the key issues and concerns raised by BITC member employers.

 

We hope to contribute to further discussions in future consultations and meetings on these issues with the Government.

 

Summary

 

We welcome the review of discrimination law "Equality Bill" and the opportunity to comment on the Government's proposals. We support the Government's intention to simplify and streamline equalities legislation; however this Bill goes beyond simplification and outlines a range of new proposals which would have significant impact on employers.

 

We do not believe that some proposals have been sufficiently developed and are concerned that we will end up with, i) a lack of clarity over what employers will be required to do to meet new legal obligations after laws have been passed; ii) too little parliamentary scrutiny of potentially far reaching and complex secondary legislation.

 

BITC's priority is to ensure that workable equality legislation is developed. Good legislation should address unfair practices without imposing too onerous responsibilities upon employers, be they in the public or private sector.

 

We would like to highlight the following concerns:

 

Streamline equality laws:

 

We support the Government's proposals for greater harmonisation and specifically, plans to reference Maternity and Gender reassignment more clearly and more extensively.

 

However, the plans for further consultation leading to the development of additional proposals/requirements (e.g. age discrimination in goods & services, additional public sector duties) is a concern; as is the facility to introduce additional reporting requirements (e.g. Clause 73) within a specific time period without any detail on what employers would be required to report on, nor how.

 

The implication is that this will not be the final, single stream-lined law as suggested, and employers will continue to see the development of single pieces of legislation.

 

While we appreciate that secondary legislation provides an opportunity for more detailed and specific focus than is usual within primary legislation and that the process for passing this is simplified and quicker. We would be concerned by any reduced scrutiny and opportunity for consultation and response from employers and other stakeholders.

 

Since this Bill has the potential to be a lever for progress on equality in the UK that will outlive the current and the next Parliament, we urge Parliament to ensure that steps are taken to understand employers' concerns over the practicality of the proposals. The support of employers themselves is critical to delivering equality in the workplace and ensuring the success of the Bill in meeting its objectives.

 

Clause 73: Gender Pay Gap Reporting

 

BITC supports pay audits and encourages all employers to audit pay and tackle discrimination (significantly higher numbers of our Opportunity Now campaign conduct pay audits that the average). Pay inequality between men and women is detrimental not only to women but also society, the economy and individual employers.

 

However, it is important to acknowledge that reporting on equal pay provides only an indicator of the equality culture and practices of an organisation. Best practice demonstrates that a holistic approach to equality, within which pay is an important element, is the best means to effect deliver equality behaviours in the workplace.

 

We are concerned over the difficulty of creating a suitable, fair reporting format that meets the needs of organisations of very different sizes, in very different sectors and with potentially very different employee profiles.

 

With employers currently making use of a multiplicity of pay systems and reporting mechanisms it may not be practically possible for employers to report on their gender pay gap with any great consistency across the economy.

 

Considerable further research is needed before meaningful public gender pay gap reporting becomes a realistic option for all employers.

 

 

Use of public procurement to improve equality

 

Using procurement to drive social/employment policy is worth exploring, but it opens up difficulties given the conflicting priorities that procurement departments already face over price and environmental considerations.

 

The Equality Duties for Disability, Gender and Race currently make provision for consideration of these areas in procurement thinking. However employers in both the public and private spheres report confusion as to how to respond to this. Few employers have comprehensive information across all strands on their employee profile. Even the most sophisticated champions of diversity struggle to collect accurate data on race, disability, sexual orientation and religion/belief.

 

Those employers who are working in this way tell us that success is derived through adopting a flexible approach and it is important that legislating doesn't prevent this. Promoting employment policy via procurement has the greatest impact when a supplier and service provider work together to tie in to their agreements diversity objectives that are both meaningful and practical. This adaptable approach is a proven driver for change which can be inclusive of the smallest as well as the largest supplier.

 

Use of positive action in the workplace

 

BITC supports positive action to speed up the rate of progress underrepresented groups are making in the workplace, but Positive Action provisions must be handled with greater sensitivity.

 

The focus for proposals appears to be public sector employment where an employer should be able to pick an ethnic minority or woman where two candidates are equally qualified. While the Government is merely seeking to clarify existing positive action provisions, many employers have expressed unease over the language used to date and this suggests the Government's proposals may have little impact in practice. We fear many employers will opt not to take up this voluntary option (nor will be encouraged to do so by many under-represented groups in their workforce) and will continue to choose to steer clear of use of positive action provisions during/after the recruitment interview process.

 

We had hoped Government would take the opportunity in this Bill to promote wider balancing measures which support and encourage employers to work with potential employees from disadvantaged groups prior to the interview process.

 

On this, progress will only be made if Government works in partnership with employers to ensure that all people in the UK are able to reach their full potential irrespective of their background.

 

 

Making age discrimination with respect to Goods & Services unlawful

 

We remain concerned over proposals to extend legislation to goods & services on age. The Bill argues differential treatment will continue where it is 'justified' or 'beneficial' and will only stop age discrimination where it is deemed to have negative or harmful consequences. This will create a legal minefield. This will also impact on employers with respect to employee benefits (e.g. insurance) and providers of financial services.

 

Business in the Community (BITC) and our members would welcome an opportunity to provide specific feedback as required. We are keen to engage in further discussion and debate on any of the issues raised in our response.

 

June 2009