Watch the webinar
In the second of the CBI’s webinars on race, we were joined by Sandra Kerr CBE, National Campaign Director of Business in the Community, Miatta Fahnbulleh, CEO of the New Economics Foundation, Rachel Farr, Knowledge Lawyer at Baker McKenzie and Matthew Fell, CBI Chief UK Policy Director, to discuss race and equality at work.
These were the key points raised in the conversation:
- The disproportionate impact of Covid-19 on Black, Asian and minority ethnic (BAME) groups
- How businesses should tackle racial inequality
- Discrimination and the law
- “Build back better” should include racial equality.
The disproportionate impact of Covid-19 on Black, Asian and minority ethnic (BAME) groups
The Black Lives Matter movement and protests have highlighted the need for change at a pivotal moment. “We’re right in the moment of the return to work as businesses think about restarting and reopening,” said Matthew Fell of the CBI. As companies make decisions about the reopening, they need to take into consideration the “concerns, the nuances” that are affecting BAME colleagues, particularly as many of these communities have been disproportionately impacted by Covid-19. Thinking about racial equality should also form part of our longer term “build back better” planning, he said.
Matthew pointed to the data on Covid deaths and UK health inequalities to illustrate why this moment might be of particular concern to BAME employees.The risk of death from Covid-19 is between 10% to 50% higher for people in BAME communities. The Covid-19 crisis has “highlighted and heightened” existing inequalities in British society including “social and economic inequality, occupational risk, living conditions and, at times, outright discrimination,” said Matthew. For example, people in the Bangladeshi community are 60% more likely to have a long-term health condition and people in the Pakistani community are 3 times as likely as white people to live in the most deprived areas of the country.
In terms of the types of work they do, BAME communities are also more vulnerable. BAME groups are more likely to work in professions with greater exposure to Covid such as health and social care, public transport and retail. Pakistani and Bangladeshi communities are more likely to be self-employed than white British people, exposing them to greater economic risk from the present downturn.
How businesses should tackle racial inequality
Sandra Kerr of Business in the Community noted that it is in all of our interests to prioritise racial equality. She pointed out the results from the 2017 McGregor-Smith review of race in the workplace which found that progression for Black and minority ethnic people would add £24bn to the UK economy per year. “Right now that’s going to come in very handy as we try to boost back the economy,” she said. “It’s going to be good for all of us if we just get our heads around this.”
Sandra stressed the importance of checking in with BAME colleagues at this time. Most people in BAME communities will know of someone who has died from Covid-19, she said. “Do not underestimate the impact of just being interested and concerned."
Regarding the Black Lives Matter movement too, “employers have to check in” said Sandra. The killing of George Floyd has been a traumatic event for many in the Black community, which is already disproportionately impacted by common mental health problems. Black parents are also having to handle the questions and the distress of their children, who may have seen the video of Floyd's murder. For employers, checking in on employees’ feelings is vital. “These conversations have to be had and we need an awareness of that invisible stuff,” said Sandra.
Miatta Fahnbulleh, CEO of the New Economics Foundation reiterated Sandra’s point that equality benefits us all. Businesses need to stand up and say “it is not in our interest to have systemic inequality. It is not in our interest to have communities that are left behind,” she said. Companies can use their voices to influence change and they can work on their own internal policies to promote equality. “What companies can do at a firm level is think really hard about their hiring practice, about their talent management practice. That genuinely creates opportunities and progression for people from disadvantaged backgrounds,” she said.
Discrimination and the law
Rachel Farr, a lawyer at Baker McKenzie, talked us through some of the legal intricacies for employers and employees regarding workplace discrimination in the context of Covid, the furlough scheme and the threat of redundancy.
Rachel noted that as employers consider the return to work, they should not necessarily apply all the same measures for all employees. Although government guidance on shielding only applies to people over 70, pregnant women and people with particular health conditions, employers can also take into account the growing body of evidence that Covid has greater health risks for BAME employees. “Mutual trust and confidence” between an employee and their employer is one of the foundational obligations in UK employment relationships. Rachel asked whether this duty can be fulfilled if employers are demanding workers return in conditions where they feel uncomfortable and unsafe.
Rachel likewise noted that businesses should look out for “unconscious bias” in decision making around redundancies. A decision that leads to greater numbers of BAME employees being made redundant that does not impact white workers could be classed as indirect discrimination, although businesses are only liable if there is “no objective justification” for the company’s action.
Sandra likewise highlighted the need for companies to think about the impact of their decisions to cut pay, furlough staff and make redundancies. Companies should watch out to see if they are disproportionately furloughing women or ethnic minority staff, and BAME staff should not be overrepresented in redundancies, she said.
Pay cuts may affect BAME colleagues more than others depending on their household incomes, so a whole company pay cut may not actually be the most equitable solution, said Sandra.
“Build back better” should include racial equality
Both Covid-19 and the Black Lives Matter movement have exposed the inequalities at work in our society. But Miatta classes herself as “an optimist.” She sees this time as a “moment for change.”
The government has spoken a great deal about “build back better,” particularly in the context of environmental sustainability. But we should also think about it through the lens of inequality, said both Miatta and Matthew. “Build back better is not just a slogan,” said Miatta. We need the government to deal with our society’s “deep-seated inequalities” to help us “recover to something better.”
Miatta outlined three areas for government to focus on:
- Protections and support for vulnerable groups including social care and housing.
- Tackling unemployment and making the levelling up agenda about marginalised groups and disadvantaged people as well as regional inequality.
- Preparing ourselves for “the next big thing”: climate change.
Key questions we answered:
- Sandra, how can businesses help address the racial inequalities we see today?
- Research shows that fully including BAME people in the UK’s workforce can stimulate £24bn in additional value to the economy. So tackling these disparities would benefit all of us.
- A report published by McKinsey this year found that companies with BAME members in leadership roles had 33% better financial returns.
- Remember that within your workforce, there will be people who have lost people due to Covid-19. So, my message to employers, is to check in with your BAME members of staff to check in on how they are doing.
- Think about your furlough policy. Is there a disproportionate number of BAME staff on furlough? And if you have to make redundancies, consider the proportion of BAME staff you have before acting.
- BAME people are less likely to have retained savings throughout their life, so when you consider things like pay cuts, consider the impact it could have on your BAME staff.
- Rachel, can you give us guidance on the law around discrimination?
- The equality act says the protected categories are race, ethnic origin, and nationality. So, they are protected against discrimination.
- Employers need to consider this when reopening. A BAME member of staff could legitimately say that if they are brought back to work and do not feel safe, they could feel unsafe as we know that Covid-19 disproportionately affects them.
- You have a duty of care to your employees. They need to trust that you are acting with their best interests at heart.
- Employers need to carry out a risk assessment under the Health and Safety at Work Act. As part of that, you must consult with your employees.
- Rachel, what is your point of view on the equal pay act, which only covers gender? Should it cover other protected characteristics as well?
- The Equal Pay Act is now part of the Equality Act.
- The Race Relations Act covered both pay and non-contractual forms of discrimination as well.
- It is a real oddity that we still have this disparity between BAME and gender-based discrimination.
- If you bring a claim against your employer, the burden is on you to prove there is discrimination taking place.
- However, there are currently huge delays in the tribunal system due to Covid-19. So, if you bring a claim now, you may have to wait until 2022 for your case to be heard.
- Miatta, after recent events, what are your views on the issue of race and equality?
- What feels different this time is the solidarity we have seen across numerous races, and the debate it has unearthed about systemic racial inequality.
- Can we tackle systemic inequality? We must ask ourselves questions about our economic model. The economy isn’t working for many people, and the last ten years have seen living standards stagnating. BAME communities have been at the sharp end of this.
- Companies need to think about their hiring practices to create opportunities for people from disadvantaged backgrounds.
- You have to ensure that social purpose is baked into companies operating models. The Good Business Charter is a step in the right direction.
- Businesses can play a powerful role in this situation. The pandemic requires big changes in how our economy works and the decisions that government make. And it’s time for businesses to say it is not in our interests to have systemic inequality and divided societies.
- Sandra, if a company wanted to set up a support group for BAME staff, is it better for this to be an all-BAME group or should there be white members too?
- We have found, throughout this crisis, that many white people are very keen to be our allies. Part of that process is hearing the stories of BAME people in the workplace, so I would say their involvement is important.
- There is also the increasingly common theme of blended families, white people marrying BAME people. So, there may be a vested interest in them being part of these groups to learn and listen with fresh ears.
- Rachel and Sandra, is there a risk that an organisation could be seen as institutionally racist if it doesn’t consider the BAME vulnerability to Covid-19 when making decisions around redundancies and bringing people back to work?
- Rachel – If an employer was to make a large number of BAME employees redundant, but this didn’t affect white workers, then there is a chance of an indirect discrimination claim. The employer would need to show why they have carried out this policy and should try to assess the impact of their policy on their workforce. They need to rule out the unconscious bias that may be affecting their decisions.
- Sandra – There is an opportunity for people to be redeployed into other roles before being made redundant. It’s also important to note that BAME members of staff may be less likely to be in a position where they can take an economic hit. Managers need to talk to employees to understand their lives to inform their decisions.
- Miatta, what should the government do in response to this issue?
- There is a consensus that things need to change.
- I have no doubt that we can recover doing the normal economic levers. But we want to recover better by addressing the inequalities that exist.
- We need to provide social care, housing, and public services. We need a drive towards job creation on an equal footing.
- Let’s recover in a green way so we are not hit so hard in the not so distant future.
- Matthew, how will the CBI drive change on this?
- This crisis has opened eyes about the power of employee engagement and what it can do for a company’s productivity. So, we need to harness that going forward.
- The CBI agrees that we need this issue to be at the heart of an economic recovery plan. We have talked a lot about building back better. We need to ensure that fairness and inclusion in our society is even more prominent in an economic recovery plan.
- We should be challenging and asking challenging questions to our members to ask them what they are doing on this. Whether that is reassessing recruitment, retention, and progression or BAME pay reporting.