Deloitte voluntarily reports ethnicity pay gap for second year running has been saved
Deloitte voluntarily reports ethnicity pay gap for second year running
13 February 2019
Deloitte UK voluntarily reports its ethnicity pay gap for the second year running today. The median hourly pay gap for Deloitte UK’s Black, Asian and Minority Ethnic (BAME) employees stands at 7.9% (it was 6.9% in 2017) and its mean ethnicity pay gap at 12.9% (11.7% in 2017). The firm’s median bonus gap for BAME employees is 25% (30.0% in 2017) and its mean ethnicity bonus gap 45% (40.8% in 2017)*. However, a reduction in disclosure rates from 83.1% in 2017 to 75.4% in 2018 makes a true year-on-year comparison challenging.
Analysis shows that the gap is due to the lower proportion of BAME employees holding the most senior positions within the firm, an issue that Deloitte is working hard to address. While BAME people made up 22% of Deloitte’s overall workforce in April 2018, only 5% of partners and 10% of directors (the grades attracting the highest levels of remuneration) are BAME.
In-grade pay gap
Deloitte analysis shows that the average mean ethnicity pay gap within grade pools was around -2.4% (i.e. in favour of BAME employees). A significant driver for this is the high proportion of London-based BAME employees; 74% of BAME employees are based in London where salaries are, on average, higher. In comparison, only 58% of Deloitte’s non-BAME employees are based in London.
Encouraging change through transparency
To further increase transparency, Deloitte is publishing two additional, voluntary calculations: the equity partner earnings gap and the total earnings gap, which takes into account the earnings of the whole firm, including equity partners. The earnings gap stands at 10.6% (median) and 43.9% (mean).
Emma Codd, managing partner for talent at Deloitte UK, says: “We first voluntarily published our ethnicity pay gap in December 2017 and I’m a firm believer in the role such transparency can have in encouraging change. I welcome the Government’s recent consultation on ethnicity pay gap reporting and would encourage other firms to publish their own data.
“Meaningful and sustained change takes time but we are starting to see the results of some of our actions. This year we’ve seen a rise in the proportion of BAME promotions to partner level and an increase in the number of BAME students applying to join our firm – both encouraging signs that our actions are starting to have an impact.
“Today’s pay gap report shows that we still some way to go and that’s why we are fully committed to providing an inclusive and respectful working environment, alongside targeted actions to help achieve the balance we should have in our firm.”
Targets and actions
Deloitte has agreed targets in line with the Parker Review, committing that, by 2021, 10% of its partners will be BAME, its Executive committee will have at least one BAME member, and each of its business leadership teams will include at least one BAME member.
Deloitte’s Executive agreed a BAME action plan in 2017, which comprises a number of targeted actions. These include widening student recruitment efforts, monitoring the pipeline of future BAME leaders, reviewing all promotion and reward decisions from an ethnicity perspective, establishing a BAME Advisory Council to feed into the firm’s strategy, and identifying development opportunities both within and outside of the firm (including through external mentoring programmes). This is all done in tandem with Deloitte’s continued focus on ensuring it provides a truly inclusive culture, underpinned at all times by respect.
Deloitte has been recognised for the steps it has already taken to ensure that there are no barriers to its people progressing within the firm. Deloitte was one of the first organisations to sign the ‘Race at Work Charter’ developed by the government and Business in the Community (BITC). It was also listed as one of BITC’s ‘Best Employers for Race’ for the second year running and as a ‘Top 10 Employer’ at the Investing in Ethnicity Awards.
*The above median and mean ethnicity pay and bonus gaps are based on hourly rates of pay as at the snapshot date of 5 April 2018, and bonuses paid in the year to 5 April 2018.
Note to editors
- The ethnicity pay gap illustrates the percentage difference (for salary and bonus) between BAME and non-BAME colleagues within Deloitte as a whole – it is not about equal pay.
- All figures above are based on a disclosure rate of 75.4% (compared to 83.1% in 2017).
- As a firm that recruits approximately 4,000 people each year, ensuring that new joiners feel comfortable in disclosing their ethnicity data is critical to our ability to determine actions and measure their impact; thus, this year we have also embarked on work to encourage such disclosure at the time of entry to the firm.
- When we reported our ethnicity pay gap in December 2017, we followed the government gender pay gap methodology guidelines (which excludes Channel Islands and Northern Ireland, both of which are locations where we have UK employees). For this report, in order to align to the ‘Deloitte UK’ figures in our gender pay gap reporting, we have included Channel Islands and Northern Ireland; this is important in order to provide the full picture across our entire UK firm. In order to compare like-with-like above, we have therefore recalculated our FY17 figures to include Channel Islands and Northern Ireland.
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The information contained in this press release is correct at the time of going to press.
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