Black and Minority Ethnic People: Workplace Issues

Lord Sheikh Excerpts

Tuesday 3rd May 2016 Lords Chamber

[Lord Sheikh (Con)]

My Lords, we are very lucky to live in such a diverse, multiracial and multicultural society. The variety of ethnicities, cultures and religions that comprise the British people make our country richer, more interesting and ultimately more successful. They benefit us socially, culturally and economically. The Office for National Statistics estimated last year that around 13% of our population are now from an ethnic minority background. This is a significant minority and as such it is important to consider the challenges they may face.

Since coming here from Uganda, I have generally found the United Kingdom to be an open, warm and welcoming country. This country is a land of opportunity and if one is prepared to use one’s initiative and work hard, one will do well and the sky is the limit in regard to advancement.

I would now like to talk briefly about myself. I was originally trained by a leading insurance company and obtained my qualifications in insurance and financial services. After my fellowship, I was involved in academic work and subsequently joined an organisation as a manager. I then became the chief executive and majority shareholder of this organisation. This company won 13 major insurance awards over a period of three years, an achievement which has not been equalled by any other organisation. Today, I am chairman of three companies. I have been a president of the Chartered Insurance Institute and chairman of the British Insurance Brokers’ Association. I was the first foreigner to hold these positions.

Ultimately, I had the honour of being made a Member of your Lordships’ House, as the first Muslim Peer from my party. I say this for a certain reason—to emphasise that I have personally not been subjected to any racial or religious prejudice. However, I am not at all complacent and emphasise that there are various challenges and issues facing people from BME backgrounds. I am actively involved in mentoring the BME community to achieve success in business. I have long encouraged members of the BME community to become involved in politics as well as in professional institutions. Furthermore, I encourage the community to enter the Armed Forces as well as the police. Unfortunately, ethnic minorities are underrepresented in most professions. This is particularly true at senior management levels. There are in fact only four non-white executives of FTSE 100 companies. One in 10 employed people comes from a BME background, yet only one in 16 top management positions and one in 13 management positions are held by people from ethnic backgrounds. According to analysis by the TUC, BME workers with degrees are two and a half times more likely to be unemployed than white graduates. The unemployment rate for white workers with degrees is 2.3% but this rises to 5.9% for BME workers.

Discrimination in the workplace occurs in many different sectors and professions. A 2014 report found that while the NHS in England is the largest employer of BME staff, with one in six NHS staff being from the community, BME staff in the NHS are discriminated against in several ways. For example, BME staff are grossly underrepresented at senior levels in the NHS, and their presence in these roles has declined despite the increasing number of BME nurses and doctors.

A report published last year by the Equality and Human Rights Commission found that unemployment in the United Kingdom in 2013 displayed a significant disparity by ethnicity: while nearly 75% of white people were employed, only 59% from ethnic minorities were. The employment rate in the Pakistani and Bangladeshi communities is particularly low. In 2015 the employment rate was 55%. That is, however, an increase since 2005, when it stood at 42%. For those in work, ethnic minority employees can still face workplace bias. In one year alone, 30% of BME workers witnessed or experienced racial harassment in the workplace. It should be noted that there is another issue: gender. Pakistani and Bangladeshi women are less than half as likely to be employed as other women. This is partly cultural but it can be improved by better education and by improving economic conditions in deprived areas.

We also need to consider the ethnicity pay gap. Recent analysis by the ONS Labour Force Survey found that ethnic minority employees educated to degree level face a 10% deficit in pay. This rises to 17% for those who leave education at 18. I applaud the Government’s drive to close the gender pay gap—perhaps a similar initiative could be considered to address ethnic differences.

I am an office holder of the All-Party Parliamentary Group for the Armed Forces and regularly meet senior officers from all three services, including those from ethnic minorities. I have been assured at very senior level that service men and women are appointed and promoted purely on merit, which is very encouraging. However, we need to make every effort to recruit, retain and promote officers from the BME communities.

It occurs to me that part of the challenge may be to promote greater awareness of these cultures and the values to which they adhere. If others are more knowledgeable, perhaps there will be less ignorance and misunderstanding. Of course, it is also imperative that we take positive steps to attain integration of the various communities. We must all work together to achieve better integration, which will result in better employment prospects for the BME communities.

Indeed, research has shown that companies with diverse workforces perform significantly better. The global consultancy firm McKinsey & Company reported last year that companies in the top quartile for racial and ethnic diversity are 35% more likely to produce above-average financial returns. It is also suggested that more diverse companies are better able to secure top talent, improve their customer orientation and increase levels of employee satisfaction and morale. I believe that companies gain through learning from each other’s experiences. People from different backgrounds see things from different perspectives and therefore can bring new and fresh ideas with them.

I am disturbed by the high number of Muslims convicted of criminal offences other than terrorist activity. They are in prison and not working. I used to be the chairman of the Conservative Muslim Forum and am now its president. We briefly looked at this issue but I feel we need to undertake an in-depth study of the patterns of offending and reoffending relating to Muslims. We can then perhaps look at the remedies. I ask my noble friend the Minister to comment on this issue and perhaps say whether the Government would support such a study.

It is important to note that legislation already exists to protect people from discrimination in the workplace. The Equality Act 2010 contains provisions on treatment with regard to race and ethnicity, as well as religion and other characteristics. Therefore, protection already exists with regard to these issues. However, we need to look more closely at how to address some of the wider, more implicit, often unintended forms of prejudice.

Thankfully, the Government are taking some action. I pay tribute to the Business Secretary Sajid Javid for asking my noble friend Lady McGregor-Smith to lead a review looking at the issues faced by businesses in developing BME talent. This forms part of the Government’s BME 2020 plan, which is aimed at improving labour market conditions for those from ethnic minority backgrounds. We have already heard about this review in detail from my noble friends the Minister and Lady McGregor-Smith. I wish my noble friend Lady McGregor-Smith success in her review and hope that, through the BME 2020 plan, the Government will be able to tackle the issue of workplace discrimination once and for all.

We enjoy great peace and harmony between cultures and religions in the United Kingdom. This country has successfully assimilated many people from abroad who have contributed to the advancement and well-being of this nation. I hope we can continue to identify issues relating to the BME population and ensure fair treatment for those from ethnic minority groups. We must encourage people from those cultures who have come to the United Kingdom to stay here, to make it their home and to help grow our economy further.