Anti-racist employment strategy - A Fairer Scotland for All

Section 1: Knowing Your Workforce through Data

Knowing your workforce and the community it is drawn from is the first step in ensuring that your workforce is representative. It can also identify gaps in representation, including across pay bands and responsibilities in the organisation.

Data is therefore a key theme that runs through a number of the actions we intend to take forward for the strategy. This is because better data can inform more effective action. Yet there are gaps and limitations with the data that exists.

Scotland's minority ethnic population is a relatively small group. In 2021, minority ethnic groups accounted for around 5% of Scotland's population (16-64 years) compared with around 15% for the UK as a whole. This means that sample sizes are small, leading to a high degree of variability in national-level estimates over time.

The ethnicity pay gap is a statistical measure which shows the difference in the average pay between white employees and racialised minority employees in the workforce, expressed as a percentage. It is indicative of a variety of factors such as occupational segregation, underrepresentation in senior roles, overrepresentation in lower paid/entry level roles; inflexible work; the lack of quality part-time work; racialised minority women's experiences of gender-based violence, and pay discrimination. The pay gap relies on self-reported pay and is based on a survey sample, rather than being collected through more accurate pay systems.

The ethnicity pay gap is different from the employment gap:

• Pay Gap - The difference in the average pay between minority ethnic employees and white employees.
• Employment Gap - The difference in the employment rate of the 16-64 minority ethnic group and the 16-64 white group.

Organisations that report their pay gap use their analysis to:

• Understand inequalities that exist in their workforce; drive strategies for recruitment, retention, and progression.
• Demonstrate their organisation's commitment to, and accountability for, equitable employment outcomes.
• Understand the extent of occupational segregation in their workforce where one demographic group is overrepresented or underrepresented among different kinds of work or different types of roles.

Pay gap reporting can also be limited in terms of what it shows.

• It does not show who is most affected by the gap and the term ethnicity is a homogenous categorisation that will not show pay disparities that may disproportionately affect particular ethnic groups more than others.
• A small or negative gap can be misleading if representation is low in an organisation and that representation falls within higher paid positions. Low representation is far more likely in rural and lower population centres. If a gap is based on a small sample size, the data is more easily skewed. The gap is therefore not always a clear indication of the experience of racialised minorities in the workplace or the organisation's commitment to equality and diversity.

There are instances where a short-term widening of the gap is reflective of positive changes in an organisation, such as in cases where a greater number of racialised minority workers have entered the workforce on entry-level pay grades, in comparison to those who have been in the organisation longer and who are on a higher pay grade within the same salary range.

All employers can take steps in relation to their data, but these steps can vary according to the size or location of the organisation, for instance those in rural and island communities.

As a starting point, all employers can look at how they are collecting and analysis data on their workplace profile. They can also look at whether their data shows representation of racialised minority staff. This information could contribute to an employer's further work on reporting the pay gap, but it can also be used to understand where there are gaps in representation and to take action to address those gaps. Data actions will be proportionate to the size and experience of the employer and may differ between micro/small and medium employers, and large corporate or public sector employers.

Gathering and analysing data can be done in different ways:

Quantitative data can be gathered to understand the staff profile according to ethnicity category, e.g. the number of staff who are Asian and where they are represented across roles in the organisation.

Qualitative data can tell you about staff experiences of the workplace and this could be gathered through staff surveys or focus groups.

Both data types will provide insights that help to improve policies and practices.

The Scottish Government as an employer collects pay gap information but it is only one part of the picture that helps us determine how we can address structures and processes that enable and embed institutional racism. Alongside this we analyse data from other sources, including our annual Civil Service People Survey, which helps us understand workers' workplace experiences.

A key theme in the refreshed Fair Work Action Plan is around building the evidence base. This acknowledges that data gaps exist. Activity is underway both at a Scotland and UK level to improve the data quality of labour market statistics including improved estimates for protected characteristic groups.^[20] In 2021 the Equality Data Improvement Programme was launched by the Scottish Government, setting out our approach to improving Scotland's equality evidence to support inclusive policy design and delivery.

To help improve the evidence base at an organisational level, we are taking forward the following:

• Encouraging and supporting local authorities in their work to improve data disclosure.
• Disseminating and raising awareness among employers the availability of national data.
• Demonstrating use of data in positive action measures through guidance that will be developed with partners and stakeholders.

It is important that employers across all organisations begin to build their evidence base in order to take actions that are informed by data. Within our refreshed Fair Work Action Plan we will be pushing for the UK Government to mandate ethnicity pay gap reporting across the economy. This in itself will help to build evidence both nationally and at organisational levels.

Within these actions, we will also focus, as far as possible, on intersectional analysis of data to understand workers that face multiple intersectional barriers and where barriers are presented for different people. This includes within the Scottish Government's workforce, and that is why another of our actions includes conducting an equal pay audit examining pay gaps by race which will inform Scottish Government's recruitment and retention policies to address workplace inequalities.

Actions for employers

All employers can start somewhere on data. Below is one approach that can be taken.

Assess – Plan – Action – Review

Assess – what data can you collect?

• Collecting whatever data you can is better than collecting none at all.
• Consider available sources of quantitative (e.g. ethnicity workforce data) and qualitative data (such as anonymised surveys or focus groups) to get a comprehensive picture of how staff are represented and how they feel about working in the organisation.

Plan – how will you collect it?

• Ensure there is anti-racist messaging tailored for the whole workforce to support any mechanisms put in place for collecting both quantitative and qualitative workforce data and that these mechanisms are accessible and can be used in safe spaces.

Action – what do you do with the data?

• Gather the data.
• Analyse the data you receive. Keep it proportionate: start by looking at white versus non-white groups, and disaggregate all groups where the data allows.
• Conduct intersectional analysis that takes account of other characteristics (such as gender, disability, age and religion) where the data allows.
• Determine what action you can take based on the data you have collected and impact assess policies and practices to identify barriers for equalities groups.

Review – monitor and evaluate your actions

• Review and evaluate the effectiveness of actions.

All data should be collected and used in line with data protection legislation. Data protection is not a barrier to collecting data, but offers a framework for how data can be used, and helps to protect individuals who could be harmed by the misuse of their data. The Information Commissioner's Office is the regulatory body for data protection in the UK, and provides extensive guidance for organisations on how to follow data protection legislation.^[21]

Further information including case studies can be found in the Knowing Your Workforce Through Data Appendix.