Key Takeaways:
- New Zealand’s gender pay gap has improved this year, but there is still much work to be done to achieve pay equality for women.
- For every $1 earned by a Pākehā man, a Pacific woman would earn 79c, a Maori woman 82c, an Asian woman 84c, and a Pākehā woman 93c.
- Campaigners are calling for mandatory pay gap reporting and a fair and consistent pay equity process to address the gap.
- The government should introduce measures to reduce the pay gap, such as requiring large employers to report pay differences and include pay in job ads.
- Normalizing flexible working, strengthening parental leave, and reducing bias and discrimination in the workplace are also necessary to address the gap.
Introduction to the Gender Pay Gap
The gender pay gap in New Zealand has improved this year, but campaigners say there is still much work to be done to bring pay equality for women. According to Still Minding the Gap spokesperson Jo Cribb, for every $1 earned by a Pākehā man, a Pacific woman would earn 79c, a Maori woman 82c, an Asian woman 84c, and a Pākehā woman 93c. This means that women in New Zealand are essentially working for nothing for four weeks of the year. Cribb emphasizes that research shows that women’s education levels, occupation, or experience account for less than 20 percent of the pay gap, and that unconscious or conscious bias within organizations is the main driver of the gap.
The Need for Mandatory Pay Gap Reporting
Cribb argues that the government should introduce mandatory pay gap reporting to address the issue. Labour’s spokesperson for women, Carmel Sepuloni, has introduced a member’s bill that would require large employers to report pay differences and include pay in job ads. Cribb believes that if 61 MPs support the bill, it could become law soon. She also points out that there is clear overseas evidence that mandatory pay gap reporting drives meaningful action and has seen national gender pay gaps drop by 20 percent to 40 percent. This suggests that introducing similar measures in New Zealand could have a significant impact on reducing the pay gap.
The Complexity of the Pay Gap
Equal Employment Opportunities Commissioner Gail Pacheco notes that the reduction in the pay gap this year may be due to fewer lower-paid women being in work. She emphasizes that the pay gap is only measured for those who are employed, and that if more low-wage women have become unemployed, it could artificially bring the pay gap down. Pacheco also highlights the need for a fair and consistent pay equity process, as well as addressing structural drivers of the gap, such as normalizing flexible working and strengthening parental leave. She notes that some organizations may not be aware of their pay gaps until they look closely at the data, and that there may be gaps in certain roles or at certain levels of the organization.
The Importance of Addressing Structural Drivers
Pacheco emphasizes that addressing the structural drivers of the pay gap is crucial to reducing it. This includes making flexible working normal and available at all job levels, strengthening parental leave for fathers and partners to share the care load, and reducing bias and discrimination in the workplace. Council of Trade Unions national secretary Melissa Ansell-Bridges notes that the pay gap has only dropped this year if it is calculated on median pay, not mean. She argues that the mean pay gap is still 8.7 percent and that the reduction in the median pay gap may be due to movement in the middle of the pay scale. Ansell-Bridges also notes that the drivers of the reduction in the pay gap, such as public sector pay increases, are no longer happening, and that the current reduction may be a high water mark.
International Comparisons and Next Steps
Cribb notes that all European Union nations and more than 50 percent of OECD members, including Australia and the UK, are introducing measures aimed at reducing gender pay gaps. She argues that New Zealand should follow suit and introduce mandatory pay gap reporting, at least for public sector businesses. Cribb suggests that the government could provide a long implementation time to acknowledge the challenging trading environment and use existing tools, such as the one on the Ministry for Women website, to help businesses work out their gender pay gaps and take action to close them. Ultimately, addressing the gender pay gap will require a concerted effort from government, businesses, and individuals to create a fair and equitable workplace for all.