Requirements on firms to collect workforce diversity data

Updated 29 April 2013

Approach and arrangements for 2013

Introduction

• 1.

  In 2011, the Legal Services Board (LSB) published their decision paper on increasing diversity and social mobility in the legal workforce. This requires approved regulators, such as the SRA, to ensure that a comprehensive evidence base about the diversity characteristics of the legal workforce is available.

• 2.

  As a result, firms regulated by the SRA are required to collect, report and publish workforce diversity data about the diversity make-up of their workforce. The SRA has adopted the diversity monitoring categories as set out in the LSB model questionnaire.

• 3.

  In collecting this data, firms are required to give every individual in their workforce an opportunity to self-classify against a range of diversity characteristics. The aggregated workforce data must be reported to the SRA, broken down by the specified role categories and a summary of that data published by the firm.

• 4.

  The time table for 2013 is as follows:

  • Firms are advised to start planning their diversity data collection now;
  • The facility for online reporting will open in the Summer 2013 and will remain open for firms to comply with their annual reporting requirements;
  • Firms must report their data online to the SRA by 31 January 2014;
  • The SRA will take a snapshot of the aggregated data in February 2014.

A new approach for 2013

• 5.

  In 2012, when these requirements were first introduced, the SRA provided firms with an online survey which they were asked to circulate to their workforce and individual responses across all regulated firms were collated by the SRA.

• 6.

  The arrangements for collecting and reporting workforce diversity data from firms will be different in 2013. The main changes are:

  • The SRA is not offering an online survey in 2013, firms must make their own arrangements to collect their own workforce data.
  • There are minor changes to the diversity questions we will be using in 2013 but it they will remain closely aligned to the LSB's model questionnaire.
  • Firm will be required to report their aggregated workforce data to the SRA.
  • Firms will be required to publish a summary of their workforce diversity data, for example on their website.

Which firms are covered by the requirement to collect workforce diversity data?

• 7.

  The requirement applies to all firms regulated by the SRA, including sole practices, recognised bodies and alternative business structures.

• 8.

  However, only one set of data is needed to cover firms which are "linked" to each other, for example, a firm and its corporate partners, a firm and its trustee companies or nominee companies and a firm's head office and its branches. Even though all such entities are regulated by the SRA and are covered by the requirement to collect workforce diversity data we do not need to collect, report and publish a separate set of data for each firm individually where they are linked.

• 9.

  The main regulated firm should be identified (perhaps the main head office) and the response for that firm and all other linked firms should come as one submission from that global practice. Accordingly, directors, owners, and staff of the linked firms should be included with the submission of the main regulated firm. If firms have any questions about how to proceed, they should email the SRA at diversity@sra.org.uk.

• 10.

  The requirements do not apply to regulated individuals working for in-house practices or other bodies not currently regulated by the SRA.

What are firms required to do?

• 11.

  Firms regulated by the SRA are required to collect, report and publish workforce diversity data annually.

• 12.

  The responsibility for making arrangements to collect, report and publish this data lies with firms.

What data needs to be collected?

• 13.

  The SRA has published guidance for firms in compiling the diversity questionnaire which sets out the data that firms will need to collect.

• 14.

  The SRA will only be able to accept the data from firms in a format which is consistent with the diversity questionnaire. However, firms may wish to add further guidance for their staff in the questionnaire and may wish to collect additional data from their workforce for their own use. A Word version of the diversity questionnaire (DOC 5 pages, 26K) is available for firms to adapt for their own use.

• 15.

  For each of the questions in the diversity questionnaire, there are categories for individuals to select and each question has a 'prefer not to say' option. It is for each individual to classify themselves using these categories, and a firm must not attempt to complete the questionnaire on behalf of an individual within its workforce.

• 16.

  Although they must be given an opportunity to provide their diversity data, individuals cannot be compelled to complete the questionnaire or provide their diversity data.

• 17.

  As this process will involve firms collecting and processing sensitive personal data firms will need to think about how to protect that data. The firm's arrangements will need to provide for reporting the aggregated data to the SRA. For information about data protection requirements please see the Information Commissioner's Office (ICO) website.

• 18.

  We have published a Diversity data publication framework, about the requirement on firms to publish a summary of their workforce diversity data. The responsibility for compliance with the data protection legislation remains with the firm and firms will need to think carefully about this at the outset, not just at the point of publication.

Who should be included in the firm's diversity data collection?

• 19.

  Everyone working at the firm should be covered by the workforce diversity data collection exercise, including owners of the firm and all other qualified and non qualified staff. Individuals will need to be classified in accordance with the role categories set out below.

• 20.

  This should include:

  • full time and part time employees,
  • employees on maternity leave or on long term sick leave from the firm (but only if they are in contact with the firm during their absence and are willing to participate in the data collection),
  • temporary employees, those engaged by the firm under a secondment contract, consultants or other contracted staff where they have been or will be engaged on a contract for 3 months or longer.
• 21.

  The following people should not be included in the diversity data collection:

  • people engaged in work which has been outsourced by the firm to another firm or company,
  • barristers or other experts engaged by the firm on individual matters,
  • people who are normally based outside England and Wales.

What needs to be reported to the SRA, when and how?

• 22.

  The SRA is making arrangements to facilitate the reporting of the aggregated workforce diversity data to the SRA and precise details will be provided later in the year. The arrangements will involve firms inputting the aggregated data online.  We will be publishing further details about the reporting arrangements in the summer.

• 23.

  When reporting the data to the SRA, it will need to be broken down by the role categories set out above.

• 24.

  Firms will be required to ensure that they have reported their aggregated diversity data online to the SRA by 31 January 2014 and should have arrangements in place to collect the data from everyone at the firm in good time to meet the reporting deadline.

What do firms have to publish and how?

• 25.

  In addition to reporting the data to the SRA, firms are required to publish a summary of their workforce diversity data. The diversity categories of sexual orientation and religion or belief are exempt from the publication requirement, but must still be collected by the firm and reported to the SRA.

• 26.

  The responsibility for publishing this data rests with the firms and the firms themselves must ensure that they are compliant with the data protection legislation. The publication requirement does not override the data protection legislation and firms must ensure that they comply with the data protection principles and do not publish data that may identify individuals within their firm.

• 27.

  The SRA's Diversity data publication framework has been published.

Why have these requirements been imposed on firms?

• 28.

  These requirements stem from the Legal Services Board's transparency project which requires approved regulators, such as the SRA, to ensure that the firms we regulate are collecting workforce diversity data. This is for the purpose of meeting the regulatory objectives in the Legal Services Act 2007, in particular 'encouraging an independent, strong, diverse and effective legal profession'.

• 29.

  The SRA has imposed these requirements on regulated firms in order to comply with the LSB's expectations of us as an approved regulator. However, the requirements are consistent with Principle 9 from the Handbook which requires firms to 'encourage equality of opportunity and respect for diversity' and the outcomes in Chapter 2 of the Code of Conduct. Workforce diversity monitoring is one of the indicative behaviours set out in Chapter 2.

• 30.

  The data will provide an aggregate view of the diversity make-up across the solicitors profession and ultimately across the whole legal services sector so we can track key trends. All the approved regulators are required therefore, to use the standard diversity questionnaire set by the LSB and are required to publish a report of aggregated diversity data for their respective regulated populations.

• 31.

  The requirements will also promote transparency about workforce diversity at a firm level and this will provide an evidence base and an incentive on firms to take appropriate action to improve diversity and will make diversity information available to consumers, which they can use in making their choice of law firm. The 2012 report is available to download - Diversity in the legal profession, PDF 20 pages, 1MB); for the full data set, email diversity@sra.org.uk.

How do these requirements fit with the SRA's outcomes-focused approach?

• 32.

  Although this is a specific requirement which has been imposed on the SRA and firms by the LSB, we support the policy which is consistent with our risk-based outcomes-focused approach to regulation.

• 33.

  Having diversity data is a fundamental prerequisite to understanding how patterns of inequality and disadvantage can occur for some groups in all sectors of society. The aggregated data for solicitors firms will help the SRA understand the dynamics of diversity within the profession.

• 34.

  Most firms will find the data useful, for example to monitor their recruitment policy, or measure the impact of workplace policies and it provides an evidential basis to demonstrate delivery of the equality and diversity outcomes in chapter 2 of the SRA Code of Conduct. It makes good business sense for firms to access all the talent available in the marketplace and a diverse firm will be well equipped to access and serve a diverse community.