As part of the announcements made by the government about changing employment legislation, much focus (quite rightly) has been on the Employment Rights Bill. But if that wasn’t enough, the proposals to make changes to employment law in the UK are not limited to the Employment Rights Bill.
On 18 March 2025, the government issued a consultation document on the introduction of mandatory ethnicity and disability pay reporting for employers with 250 or more employees.
Not that this was a surprise. In May of last year, the Labour Party (before becoming the government) published the “Plan to Make Work Pay” document which set out a commitment to strengthen equal pay rights. They affirmed this commitment with the publication of “Next Steps to Make Work Pay” in October 2025 in which they stated that it would begin consulting on pay gap reporting for ethnicity and disability as set out in the (then) newly published Race and Disability Bill. The driver for change is that they consider that additional pay gap reporting for ethnicity and disability will provide the same transparency and impetus for positive change for people from different ethnic groups and disabled people as it has done for gender pay.
That consultation process has commenced in earnest.
What information will need to be published by employers?
In the consultation document they have set out that they propose to use a similar framework to that already in place for gender pay gap reporting which would mean that companies will be reporting on:
- mean differences in average hourly pay
- median differences in average hourly pay
- pay quarters – the percentage of employees in 4 equally-sized groups, ranked from highest to lowest hourly pay
- mean differences in bonus pay
- median differences in bonus pay
- the percentage of employees receiving bonus pay for the relevant protected characteristic
In addition to the provision of this pay information, it is also proposed to make it mandatory for employer to report on:
- the overall breakdown of their workforce by ethnicity and disability
- the percentage of employees who did not disclose their personal data on their ethnicity and disability
Large public bodies may be required to publish additional information on ethnicity, including pay differences by grade or recruitment, retention and progression data.
Action plans
The government is also seeking views on whether employers should have to produce action plans for ethnicity and disability pay gap reporting.
So, what are action plans? You may recognise that the use of the “action plans” phrase is becoming more frequent and common. The government has already (in the Employment Rights Bill) published plans to require employers with more than 250 employees to publish equality action plans. Under the current proposals, the action plans may require employers to develop and publish a plan showing the steps that they are taking in relation to their employees with regard to “prescribed matters” related to gender equality. This is to include matters relating to the gender pay gap and the menopause.
It is not clear at this point how prescriptive (if at all) the content of an action plan will be in respect of the menopause or pay gap reporting in respect of gender, ethnicity and disability. No doubt, further guidance will be provided by the Equality and Human Rights Commission and ACAS to assist employers.
Broadly speaking, action plans in respect of pay gap reporting are intended to identify why the pay gap exists and what steps are being taken to try to close it. The action plans can also be used to help businesses explain the reasons behind any pay gaps and set out the actions they are taking to improve equality in their workforce. They can also be used to ensure that employees of the business also understand the actions that their employer is taking.
The introducing of action plans would also broadly align with the findings of previous consultations regarding reporting on disabled people in the workplace. These consultations highlighted the need for reporting practices to be supported by initiatives to increase workplace equality.
A further call for evidence
In addition to this consultation, on 7 April 2025, the Office for Equality and Opportunity (OEO) issued a call for evidence on equality law.
This call for evidence is wide-ranging, covering some areas the government had not previously committed to include in the Race and Disability Bill, how some current laws work in practice, and some areas covered by the Employment Rights Bill (ERB). The call for evidence seeks evidence and views on the following:
- The prevalence of race and disability pay discrimination.
- Making the right to equal pay effective for ethnic minority and disabled people.
- Measures to ensure that outsourcing of services can no longer be used by employers to avoid paying equal pay.
- Improving the enforcement of equal pay rights by establishing an Equal Pay Regulatory and Enforcement Unit, with the involvement of trade unions.
- Improving pay transparency.
- Strengthening protections against combined discrimination.
- Ensuring the Public Sector Equality Duty (PSED) is met by all parties exercising public functions.
- Creating and maintaining workplaces and working conditions free from sexual harassment.
- Commencing the socio-economic duty in England
It is therefore likely, that the area of equality law in the UK is likely to keep changing in the months and years to come.