How to close Australia's gender pay gap

The race to close the gender pay gap is on

Analysing payroll data is just one of the steps needed to close the pay gap between men and women.

By Libby Lyons

If your workplace reflects others across Australia, then you will have a gender pay gap in favour of men.

Data collected from Australian employers by the Workplace Gender Equality Agency (WGEA) shows a gender pay gap exists in every industry. Our 2015-16 data, covering more than four million employees, reveals full-time female workers earned, on average, 23 per cent less than full-time male employees in total remuneration. That equates to a gap of almost A$27,000 a year.

The accounting services sector is no different; data shows a 21 per cent pay gap in favour of men, based on total remuneration.

The good news is that with solid commitment and a targeted action plan, there is a lot employers can do to close the gender pay gap.

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1. Identify issues that might contribute to pay inequity.

Many employers say the hardest part is knowing where to start. The first step is understanding the key issues around pay equity. Issues include women being concentrated in lower-paying roles, as well as inflexible work arrangements that may impact women’s access to senior leadership roles.

Organisations should also be on the lookout for instances of bias (conscious or unconscious) and discrimination, particularly in relation to those with caring responsibilities.

2. Analyse payroll data.

The next step is to review and analyse payroll data for women and men in your organisation.

We recommend analysing pay gaps in three ways to get a complete picture: You should identify pay gaps between women and men doing the same or comparable jobs; compare pay within management and occupational levels; and assess the pay gap across the whole organisation.

3. Take action to address the hotspots.

Once you have identified where your pay equity hotspots are, you need to take action in addressing them. This may require a multi-pronged approach, including measures such as supporting more women into management or technical roles, and examining pay review processes. These necessary measures will vary for each organisation.

Insurance firm TAL closed an 18 per cent pay gap between 2014 and 2016 by adopting a holistic approach to gender equality – first by understanding where gaps existed and securing support from leaders, and then by changing the processes that perpetuated those gaps in pay and responsibilities.

TAL now conducts a pay gap analysis by job function and employment type at least twice a year.

Viva Energy Australia has been promoting gender equality through initiatives such as actively managing base salaries and performance assessment processes to remove bias, and increasing the representation of women in operational roles. These efforts have narrowed the gender pay gap at the company by more than 7 per cent over two years.

There are many more examples of employers stepping up to the challenge and taking action to address pay gaps. For the first time, more than 70 per cent of employers reporting to the WGEA have in place proactive policies to support gender equality. While the pace of change is still too slow, I am optimistic about the future of gender equality in Australia.

Access more tips and advice for your organization.

Libby Lyons

Libby Lyons is director of the Australian Government’s Workplace Gender Equality Agency, which provides employers with advice, practical tools and education to improve gender equality in the workplace.

Read next: The fight for gender equality is far from over in the workplace


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