Ethnicity & Disability Pay Gap Reporting Compliance Check

Why this matters

On 25 March 2026 the Government published its consultation response confirming it will introduce mandatory ethnicity and disability pay gap reporting for large employers, delivering on a commitment first made in the “Make Work Pay” agenda and now being taken forward through the Equality (Race and Disability) Bill. The expected model mirrors the existing gender pay gap reporting regime under the Equality Act 2010 (Gender Pay Gap Information) Regulations 2017 — employers with 250 or more employees will need to calculate and publish pay gap figures, but this time based on ethnicity and disability status rather than sex. Unlike sex, which is recorded in payroll systems by default, ethnicity and disability status generally have to be self-reported by employees, which means employers who haven’t already been collecting this data on a voluntary basis are starting from a much weaker position than they were for gender reporting.

Detailed implementing regulations, exact reporting thresholds, and the first reporting date have not yet been finalised, but the direction of travel is clear and businesses approaching the 250-employee threshold — including those currently just under it — are already being asked about ethnicity and disability pay data by larger clients and public sector procurement processes that expect supply chain transparency. Getting data collection right is harder than it looks: employees can decline to disclose, “prefer not to say” responses need to be handled without breaching data protection principles, and small sub-group sizes can make published figures statistically unreliable or potentially identifying, which the eventual regulations are expected to address through minimum group-size thresholds similar to those used in existing voluntary EHRC guidance. Businesses that start reviewing their HR systems, consent wording, and data quality now will be in a far stronger position once the reporting duty is confirmed in secondary legislation.

What you'll need

• Whether your business currently has, or is approaching, 250 or more employees
• Whether you currently collect ethnicity and disability status data from employees on a voluntary basis
• Whether your HR/payroll system can record and report this data separately from other employee records
• Whether larger clients or public sector contracts already ask you about pay gap or diversity data
• Whether you have a clear policy for handling 'prefer not to say' responses

What you'll get

A personalised compliance report covering: a score out of 100, an executive summary, a list of findings ranked by severity, and a prioritised action plan with timeframes.