Unmasking the gender pay gap within the private sector

The latest gender pay gap reports in Australia highlight a persistent issue that requires immediate and effective action. According to the Workplace Gender Equality Agency (WGEA), as of November 2023, Australia’s total gender pay gap stands at 21.7 per cent, meaning that, on average, women earn 78 cents for every dollar earned by men. This discrepancy results in a significant annual difference, with women earning an average of $26,393 less than men.

To tackle this issue, legislation has been introduced. The Workplace Gender Equality Amendment (Closing the Gender Pay Gap) Bill 2023 (Bill), was passed by the Federal Parliament on 30 March 2023. This legislation allows the WGEA to publish the gender pay gaps of individual organisations with more than 100 employees, a move aimed at improving pay transparency and accountability commencing in 2024.

Published data is made publicly available on the WGEA’s website. This allows individuals to see and compare gender equality outcomes for industries, industry subdivisions, and groups of employers by size and individual employers. Employees and employers can use the data to gain deeper insights into gender equality performance and outcomes and compare results across employers and industries.

Here we recap the long road to transparency, explain the ins and outs of the WGEA’s 2024 Gender Pay Gap Report, and what it all means for employers going forward.

The road to transparency

In a great stride towards transparency and gender equality in the workforce, WGEA released its first report about the gender pay gap within the private sector on 27 February 2024. This milestone marks a crucial moment in the ongoing battle for gender equality in the workplace, shedding light on disparities that have persisted for far too long. WGEA identified some interesting trends amid its first publication of gender pay gaps, and a snapshot of the results show:

• All industries in Australia have a median gender pay gap in favour of men;
• Industries with higher pay rates tend to have higher gender pay gaps;
• The construction industry has the largest median total remuneration gender pay gap at 31.8 per cent, the professional and technical industries also feature at the top of the list for the gender pay gap industry-specific data;
• 62 per cent of median employer gender pay gaps are over 5 per cent and in favour of men;
• Across all employers, 50 per cent have a gender pay gap of over 9.1 per cent;
• Gender pay gaps differ widely across industry types. In female-dominated industries, the mid-point of employer gender pay gaps is 2.9 per cent. This widens to 10 per cent in mixed-gender industries and increases further to 15.2 per cent in male-dominated industries; and
• There’s a link between having at least one woman in the CEO position and a lower employer gender pay gap. The mid-point of employer gender pay gaps for employers with at least one woman CEO is 5.4 per cent compared to 10.9 per cent for employers with no women CEOs.

Despite these efforts, Australia has unfortunately seen its gender pay gap widening, prompting calls for further action beyond reporting. Recommendations include mandating corrective actions to close the gender pay gap and implementing existing sanctions for non-compliance more thoroughly.

These measures reflect a critical part of legislative actions aimed at closing the gender pay gap in Australia. However, as indicated by research and advocacy, further reforms and actions are necessary to ensure meaningful progress towards gender pay equality.

Unveiling the gender pay gaps in the private sector has been a long and taxing effort. The journey has been marked by persistent advocacy, legislative efforts, an increasing awareness of gender inequality within society and fighting sceptics who claim the gender pay gap is a myth. Over the years, various events have paved the way for this crucial step towards transparency:

1. Legislative reforms

The Workplace Gender Equality Act 2012 laid the foundation for mandatory gender reporting, requiring organisations with 100 or more employees to report on gender equality indicators annually. Applicable employers must report on six Gender Equality Indicators each year, which include:

• Gender composition of the workforce;
• Gender composition of governing bodies of relevant employers;
• Equal remuneration between women and men;
• Availability and utility of employment terms, conditions and practices relating to flexible working arrangements for employees and to working arrangements supporting employees with family or caring responsibilities;
• Consultation with employees on issues concerning gender equality in the workplace; and
• Any other matters specified by the Minister for Women, Katy Gallagher: sex-based harassment and discrimination.

Employers with over 500 employees must also meet certain minimum standards, including having a policy or strategy in certain areas, to support gender equality.

2. Activism and awareness campaigns

Civil society organisations, advocacy groups, and individuals have tirelessly campaigned for gender equality, raising awareness about the pervasive nature of gender disparities in the workforce. These efforts have played a pivotal role in garnering public support and pressuring businesses and policymakers to act. 

3. Corporate accountability initiatives

An increasing number of companies have recognised the importance of addressing gender pay gaps and have implemented measures to promote transparency and accountability. Corporate initiatives such as gender pay audits, diversity and inclusion programs, and leadership commitments have become more prevalent.

The ins and outs of the first Gender Pay Report

The release of the first private sector employer gender pay gaps report by the WGEA represents a significant milestone in the journey towards gender equality. The key highlights of the report include:

1. Comprehensive data analysis:

The report provides a comprehensive analysis of gender pay gaps across various industries, sectors, and organisational levels within the private sector. It offers insights into the factors contributing to these disparities, including occupational segregation, unconscious bias, and lack of female representation in leadership positions.

2. Identification of challenges and opportunities

By identifying specific challenges and opportunities, the report offers valuable insights for employers, policymakers, and other stakeholders to address gender pay gaps effectively. It underscores the need for targeted interventions, such as pay equity reviews, flexible work arrangements, and leadership development programs.

What does this mean for employers?

The data released in this report is crucial for understanding the deep-rooted disparities that exist within the workforce and the effective corrective measures that can be implemented to eliminate them.  WGEA has stated that in its second round of publishing, which will use data for the 2023-24 reporting year, there will be an expansion to what is published. WGEA will publish:

• Gender pay gaps individually for all relevant employers, this includes those who submit their data as a part of a submission group;
• Base salary and total remuneration average gender pay gaps, as well as base salary and total remuneration median gender pay gaps; and
• Gender composition and average remuneration pay per quartile.

This will enable employers and employees to view the impact of strategies and approaches to workplace gender equality, over time.

The publication of the WGEA’s first private sector gender pay gaps report is a big step in the gender equality fight. The data collected and released shines a bright light on where disparities exist and how we can work to fix them. It’s highlighted our shared duty to create a fairer, more inclusive society for everyone.

If any information in this article raised any questions about diversity in the workplace or compliance in the workplace, please reach out to our workplace relations experts via our 24/7 HR Advice Line.

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About our authors

Zaynab Aly is a Senior Workplace Relations Consultant at Citation Group. She has a particular interest in the retail industry and regularly provides advice on workplace matters to find solutions for clients.

Amanda Curatore is a qualified Solicitor and Senior Associate at Citation Legal. Based in our Melbourne office, Amanda is highly experienced in providing workplace relations advice and assistance to clients in a wide range of matters.