Deloitte reveals ethnicity pay gap of over 8%

21 December 2017

As increasing pressure is put upon businesses to mind the gap in pay between ethnicities and genders, a number of professional services firms have released their salary data. This has most recently seen Deloitte declare that it has a disparity in wages of almost 9% between BAME staff and their white colleagues. The details were released as part of Deloitte’s wider commitment to end the pay gap differences.

The gap in pay between workforce demographics has increasingly become a major cause for concern among the public, as the UK’s workforce steadily diversified throughout the 20th Century. Women, in particular, are often paid less than their male counterparts, despite performing the same work. A recent study found that, on average, women are paid an average of £6,100 less per year . Despite studies suggesting that, by 2025, gender equality in the workplace could add more than £444 billion annually to the UK's GDP, progress has remained slow.

However, that is not the only pay gap of note, with people from ethnic backgrounds also being found to be underpaid for similar work or unable to climb the ladder due to, among others, implicit biases. In a bid to promote action from bosses, the UK Government has required large employers to disclose pay conditions throughout their organisations, including for different ranks. The move is aimed at shining a light on conditions, creating ground swell for change to what are ultimately unfair conditions.Deloitte reveals ethnicity pay gap of over 8%Professional services firms have begun to voluntarily disclose the pay gaps, prior to the imposition of a government mandate. Among them, Deloitte, with more than 17,500 employees across the UK, revealed the current pay and bonus gap for its various ranks.

The firm’s own analysis found that the median pay gap per hour work for Black, Asian and Minority Ethnic (BAME) employees stands at 8.7%, while, across the whole of its ethnicity category, the gap stands at 12.9%. Bonus payments, however, fared considerably worse, with BAME employees being awarded, on average, 34.7% less and the ethnicity group, as a whole 41.9% less. This is comparatively lower than that of Big Four rivals EY, who recently reported an ethnic pay disparity of 17.3%, with a median of 9.8%.

As is the case with the other large consulting firms, such as PwC, which have released data revealing a difference in pay between white staff and BAME employees, Deloitte blames its own gap chiefly on there being fewer BAME and employees of ethnicities in the firm’s higher echelons. However, this is hardly a mitigating factor, as it still highlights a disproportional lack of representation or equal opportunities at these firms. As it stands, BAME background employees represent 18% of the firm’s workforce, but hold fewer than 5% of its senior positions. In order to change this, the firm has committed to increasing the number of partners from a BAME background to more than 10% by 2021.

Commenting on the Deloitte’s commitment and its wider will to create a more equitable organisation, Emma Codd, Managing Partner for Talent at Deloitte UK said, “Our focus on providing a culture and environment where everyone can be themselves, thrive, develop and succeed is starting to have a positive impact. While today’s pay gap report demonstrates that there is still some way to go, we are fully committed to achieving the balance we should have through targeted actions alongside our continued focus on providing an inclusive culture.”


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Women remain underrepresented in UK's hospitality industry leadership

12 April 2019

Female engagement at the top level of the UK hospitality industry is still lagging, with the vast majority of decision-making roles continue to be held by men. Only 7% of the industry’s FTSE 350 CEOs are women; however, the pay gap in hospitality and leisure is far better than in other industries, at a median of approximately 7%.

The hospitality, travel and leisure (HTL) sector is one of the UK’s largest employers, with 3.2 million people working in its segments. Despite a poor 2018 in terms of tightening consumer spending, the industry is still one of the top sectors in terms of economic activity, hitting £130 billion last year – besting the UK’s automotive, pharmaceutical and aeronautical sectors’ combined activities.

While the industry is one of the country’s largest employers, it still faces considerable issues around diversity at the top. New analysis from PwC has explored the matter, as well what initiatives the industry has engaged to open up its top ranks to a more diverse background.

Female representation at board level for UK companies and HTLs

According to a survey of CEOs, Chairs or HR Directors of over 100 of the most significant leisure businesses across the UK, the hospitality industry has a relatively male-dominated top level. This lags behind the FTSE 100, where companies have female board level representation at 32.2%. Meanwhile, the figure for the combined executive committee and direct reports stands at 28%. This is well above FTSE 250 levels, where female board level representation stands at 22.4% and executive committee & direct reports stand at 27.8%.

For the hospitality industry as a whole, board level representation came in at 23.6%, with FTSE 350 for the industry performing slightly better at 25.1%, while non-listed companies performed considerably worse at 18.2%. The firm notes that the figures hide that while some companies are making strides to improve equality, others are not moving forward – with the positive result reflecting more often the good work of some, while others are not taking the issue seriously in their agenda setting.

Blind spot

The study states, however, that while the overall numbers are relatively strong, the industry has a number of acute weaknesses. These include CEO numbers, with only 7% of HTL FTSE 350 companies helmed by women and 11% of non-listed companies led by female CEOs. Meanwhile, female chairs at FTSE 350 companies for the sector stand at zero. In terms of wider diversity representation, only 1 in 33 leaders at industry companies is from a BAME background.

Pay gap for HTL and hospitality

The report noted discrepancies between FTSE 100 companies and FTSE 250 in terms of improving the number of women at executive level. The majority have met the Hampton-Alexander Review target of 33% women at board level, up from around 25% in 2016. However, the remaining ~40% are not on target, and are unlikely to meet the target by 2020. A similar trend is noted when it comes to executive committee and direct reporting numbers.

Jon Terry, Diversity & Inclusion Consulting Leader at PwC, said, "To make real progress in diversity and inclusion, businesses need to elevate it onto the CEO’s agenda and align diversity & inclusion strategy to the fundamentals of the business."

Tracking progress FTSE 250 level

However, one area where hospitality travel and leisure companies are outperforming other companies in the wider UK economy, is the mean and median pay gap between men and women. PwC found that the median of the wider UK economy comes is approximately 14% – with upper quartile companies noted for a gap of low 20%, and lower quartile companies noted for differences of around 2%.

The median pay gap for HTL comes in at well below 7%, with the median close to parity. There are considerable differences, however, with hospitality at 7%, while travel comes in considerably higher, at 22%. The latter figure reflects fewer women in higher paid pilot and technical positions within the industry.