It's smaller but pay gap still there

19:20, Nov 12 2012
SOMETHIG FISHY: The High Court ruled that trimmers, usually women, and filleters, usually men, were doing similar work and should get similar pay.

The New Zealand income survey this month shows the gender pay gap is at an all-time low - 9.3 per cent in the last financial year. Nonetheless, the bottom line is that women still receive less pay than men for doing the same work.

This has long been a recognised issue both in New Zealand and internationally. There has been an overwhelming amount written on the topic. Why then is change so slow to occur? First, it is important to understand what the issue is. We are talking about pay differences between men and women who do the same work, and have the same set of skills and experience. In other words, it is only because they are women that they are being paid less.

There are a number of theories that have been offered to explain the disparity in pay between men and women. You will recall the furore over the comments made by Alasdair Thompson, former chief executive of the Employers and Manufacturers Association, that women are paid less in part because they take more sick days because of their periods.

Not surprisingly, the reason most commonly put forward is that women take time out to raise a family. Another suggestion is that women are not as pushy as their male counterparts and do not ask for more. Recent research in the United States shows that starting salaries for men were almost US$4000 higher than for women. Only 7 per cent of women, compared with 57 per cent of men, negotiated their starting salary.

What might begin as a small difference in starting salaries can, with rises over time, translate into substantial differences later on.

For example, the public relations industry has a $41,539 gap between men and women with 15-19 years' experience in the profession. Taking time out to raise a family and not being as pushy as their male counterparts appear to be only partial explanations for the discrepancy.


Some interesting research carried out by two leading economists from Cornell University shows that even taking into account education, labour market experience, race and choice of occupation, 12 per cent of the gap remains unexplained.

This leaves us facing the spectre that this 12 per cent could, either in part or entirety, be related to unlawful discrimination on the basis of gender.

The law in New Zealand prohibits gender discrimination in employment - the Equal Pay Act 1972 requires that men and women doing work requiring the same, or substantially similar, skill, effort, responsibility and working conditions be paid the same.

The Human Rights Act 1993 and the Employment Relations Act 2000 also prohibit discrimination on the basis of sex.

However, very few complaints are made to the Human Rights Commission, the Human Rights Tribunal or the Employment Relations Authority by women who consider they are being discriminated against in terms of their pay in New Zealand. Why?

For a start it might be because women are not actually aware they are being paid less. Do you know what your colleagues earn?

It is not something people tend to publicise and in fact many employment agreements prohibit employees from discussing their rates of pay.

Last year, the Human Rights Commission drafted a Pay Equity Bill that attempted to address this issue. The bill promoted the transparency of wages, made it illegal for employers to keep pay confidential and introduced a positive obligation on employers to keep records showing all their employees were paid in accordance with an equality clause. It generated a lot of discussion at the time, as did a private member's bill on the same issue. Neither, however, was passed into legislation.

Another issue is that discrimination is extraordinarily difficult to prove. Even if you do know you are being paid less, are you able to point to a male colleague in the same role, with your level of skills and expertise, but who is on a higher salary?

The answer is probably not.

An employer will generally be able to argue you are not comparing apples with apples.

There has been one case that went before the High Court in New Zealand involving a woman who was able to point to a male colleague in a similar role, with a similar level of skills and experience, but who was on a higher salary - her partner!

Caitlin Lewis was employed by Talley Fisheries Ltd as a fish trimmer in Motueka. Her partner was employed as a filleter.

Filleters were paid more than trimmers. In this particular company, trimmers were usually women and filleters men.

Ms Lewis was employed shortly after her partner. Both had identical skills and experience.

The court held that the jobs of trimmer and filleter were substantially similar, and the reason Ms Lewis was receiving less money was because she was allocated to the role of trimmer because she was a woman.

Employers can choose to pay a higher wage or salary for certain jobs but they cannot fill these roles on the basis of gender.

Just as there has been a lot written on the problem of gender and pay, there has been an equal amount of theorising on the solution. However, there is no magic formula for achieving pay equality. Each employer needs to take responsibility for their own remuneration policies and ensure that where there are differences in pay for the same or similar roles, there is a justifiable reason for it.

Pay disparity on the basis of gender does not need to be deliberate to be discrimination.

The gender pay gap might be at an all-time low in New Zealand but there is still a gap.

An ongoing and continued commitment to change is needed if it is ever going to reach zero.

Susan Hornsby-Geluk is a partner at Chen Palmer, public and employment law specialists.

The Dominion Post