The Pros and Cons of Disability Pay Gap Reporting

The numbers speak for themselves. In the UK, just 53% of working-age disabled people are in employment, compared to 81.6% of non-disabled people. And for those in work, the picture isn’t much brighter: 38% say they’ve been bullied or harassed at work because of their disability, 40% feel patronised by colleagues, and 1 in 4 are dissatisfied with their current situation. Alarmingly, more than a quarter are actively considering leaving their employer because they don’t feel treated well.

Against this backdrop, the conversation about disability pay gap reporting is gaining momentum. For some, it’s a much-needed catalyst for change: a way to hold organisations accountable and shine a light on inequities to build fairer workplaces. For others, it raises difficult questions about data privacy and the unintended consequences of these good intentions. 

This article explores both sides of the debate. What are the potential benefits of disability pay gap reporting? What are the risks if it’s handled poorly? And most importantly, how can HR leaders navigate the balance between compliance, trust, and genuine progress?

Why disability pay gap reporting is on the agenda

In the UK, the conversation about disability pay gaps is moving from “should we?” to “how soon will we have to?” The government’s new Equality (Race and Disability) Bill sets out requirements for employers with more than 250 staff to report both their ethnicity pay gaps and their disability pay gaps. Crucially, it also extends equal pay rights to cover both race and disability.

This marks a significant shift. For years, reporting requirements have focused almost exclusively on closing the gender pay gap. But by expanding the scope, the UK has signalled that transparency around pay equity needs to be broader, with disability inclusion the focal point of that picture.

At the moment, the UK is the outlier here, with no equivalent obligation across Europe. The EU Pay Transparency Directive, which member states must implement by 2026, focuses firmly on gender. Disability pay gap reporting hasn’t yet made its way into the legislation. 

One reason for this is the difficulty of producing comparable data across borders. As a 2024 European Parliament study points out, definitions of disability vary widely between countries — self-disclosure rates differ dramatically, and data protection laws make some types of reporting harder to implement. That doesn’t mean disability pay gap reporting won’t spread beyond the UK, but it helps explain why it hasn’t happened yet.

The potential benefits of disability pay gap reporting 

Public support for greater transparency is strong. In the UK, a recent survey of 2,000 professionals found that 77% support mandatory disability pay gap disclosure. For HR teams, expectations are already shifting. So, what’s the upside of reporting?

Driving accountability 

Pay gap reporting forces leadership teams to take a closer look at disability inclusion, not just at hiring or adjustments, but at pay and progression too. Data visibility can accelerate cultural change — after all, once a gap is measured and published, it’s harder to ignore.

Benchmarking progress 

Publishing figures creates a clear baseline, both internally and externally. For example, the TUC’s analysis found a disability pay gap of £2.35 per hour (17.2%), with median hourly pay for disabled employees at £13.68 compared to £16.03 for non-disabled employees. Without tracking this gap, it’s impossible to know whether initiatives to close it are working.

Enhancing employee trust 

Transparency can go a long way towards building credibility with employees. When organisations are open about their challenges, and their progress, it demonstrates a genuine commitment to pay equity. This demonstration can strengthen retention, while also boosting an employer’s reputation with prospective hires.

Creating business impact 

The benefits of disability pay gap reporting go beyond cultural improvements. There’s evidence that inclusive workplaces outperform their peers. 97% of HR professionals say employees with disabilities perform the same or better than their non-disabled colleagues. Additionally, multiple large-scale studies show that organisations with more inclusive leadership teams are significantly more likely to achieve above-average profitability. In short: when workplaces better reflect the full talent pool, they make smarter decisions, unlock innovation, and build long-term competitive advantage.

How HR can prepare to communicate disability pay gap data constructively

• Explain the “why”: Share why you’re collecting and publishing this data.
• Lead with honesty: Acknowledge gaps and challenges openly.
• Pair numbers with action: Always outline what you’re doing next, not just the metric.
• Tailor the message: Adjust language for employees, leadership, and external audiences.
• Reinforce confidentiality: Remind employees how their data is protected. 

The challenges of disability pay gap reporting 

If the benefits are clear, so are the risks. Disability pay gap reporting brings with it a set of complex challenges. For HR teams, the task is to anticipate these risks and put strategies in place to mitigate them.

Maintaining compliance 

For many organisations, reporting is already a heavy lift. Newly proposed requirements could mean some employers must meet four or more separate reporting obligations, each with slightly different rules and formats. It’s easy for this to become an administrative burden rather than a meaningful exercise.

HR tip: Align reporting cycles wherever possible and invest in tools that consolidate data. Treat reporting as part of a single pay transparency framework, rather than a set of siloed requirements.

Pressuring employees to disclose 

One of the sharpest risks is around disclosure. As the Business Disability Forum points out: 

“Disability workforce reporting does not, and cannot, measure the experience of having a disability; it can only capture the number of people who say they have a disability one specific "snapshot" moment in time." 

HR tip: Build trust before asking for disclosure. Be explicit about how you’ll use, store, and anonymise their data. Reassure employees that disclosure is always voluntary and that their experience matters beyond a spreadsheet.

Struggling with data quality 

Even with the best intentions, data may not tell the full story. As culture and inclusion professional Zaheera Mukadam warns, “The challenge with ethnicity and disability pay gap reporting won’t be about deadlines; it’ll be about whether you have enough meaningful data to report at all.” Inconsistent definitions and missing context can both skew the picture.

HR tip: Combine quantitative data with qualitative insights, such as employee surveys, focus groups, exit interviews. This provides a richer picture of inclusion than raw pay figures alone.

Triggering unintended consequences

Perhaps the most concerning risk is when reporting changes behaviour in unhelpful ways. A report entitled “Towards meaningful disability workforce and pay gap reporting” revealed that some disabled employees feel pressured to go for promotions “just to improve the figures”, even describing it as being “bullied into being ambitious.” Other employers admitted they had declined adjustments (like reduced hours or lighter duties) because it would worsen their reported pay gap.

HR tip: Make clear that the goal of reporting is fair treatment, not better optics. Celebrate inclusive practices such as flexible adjustments or supported employment programmes, even if they don’t improve the headline pay gap figure.

Red flags HR leaders should watch for

• Very low disclosure rates
• Heavy focus on PR spin over solutions
• No follow-up action plan beyond the report

Building trust and equity with Figures 

Mandatory disability pay gap reporting might have begun in the UK, but the conversation it sparks will travel far wider. As pay transparency frameworks expand across Europe, organisations will be judged not just on whether they comply, but on how they use the data to create fairer outcomes.

This is where Figures comes in. We give HR leaders the tools to move from isolated reporting exercises to a coherent, data-driven compensation strategy, covering benchmarking, salary bands, and pay equity analytics. The result: clarity for leadership, confidence for HR, and trust for employees.

If you want to get ahead of the curve, start now. Book a demo with Figures to see how we can help you turn compliance requirements into long-term equity and a serious competitive advantage.