By
Mike Toten
Mike Toten is a freelance writer, editor and media commentator.
Extensive media coverage has resulted from last week's release of "gender pay gap" data by the Workplace Gender Equality Agency (WGEA). Much of the coverage focused on naming individual businesses that reported abnormal results one way or the other, and either praising or "shaming" them. But what actually is the data and what does it demonstrate?
Why were results released?
The WGEA has been collecting annual data on gender pay gaps for many years, but new legislation passed in 2023 requires it to publish its data and the results of individual organisations. Last week's release is the first time it has reported the latter publicly, after publishing generalised results in the past. Businesses with 100 or more employees must report their results to the WGEA, which means it collects data from almost 5,000 organisations.
What is the gender pay gap?
Importantly, the data released is NOT the difference between what men and women are paid for performing the same jobs. "Equal pay for equal work" has long been the law.
The media has reported pay gaps in favour of men of both 14.5% and 19% this time. That is because two different calculation methods were used.
The 14.5% gap (which equates to a difference of $11,542) refers to the median base salary gap. This is calculated on an annualised full-time basis, which means that the salaries of part-time and casual employees are adjusted on that basis. That is intended to avoid skewing the data if a business employs a large number of part-time or casual employees (e.g. if the majority of the latter are women).
The gap increases to 19% when it becomes the "national median total remuneration gender pay gap". This is median base salary as above plus overtime, superannuation, bonuses, and other types of payments. The WGEA calculates the difference at $18,560 in favour of men.
CEOs, Heads of Business and casually employed Managers are excluded from the data collection.
The WGEA claims to have a target pay gap for organisations of no more than plus or minus 5%,
What does the gap actually imply?
Many media reports have focused on "anomalies" in the results. For example, one retail organisation had a workforce comprising only 3% of men, but reported a pay gap of 37% in their favour.
The WGEA said that, in general, jobs and sectors that are dominated by men are higher paid than those dominated by women.
For industry sectors, the biggest gap in favour of men was in Construction (31.8%), followed by Professional, Scientific and Technical Services, and Financial and Insurance Services (26% each). The smallest gap (2% in favour of men) occurred in Accommodation and Food Services.
Overall, 62% of reporting organisations had gaps that favoured men, 30% has gaps favouring women, and the remaining 8% are within the target plus or minus 5% range.
A general conclusion from the above could be that organisations will have significant gender pay gaps when their more senior roles are dominated by male employees and/or the lower-level ones have a majority of women. Such organisations may need to look more closely at the career opportunities and pathways they provide for women, recruitment/ selection and promotion practices, and evidence of direct or indirect discrimination against women.
Further information
Australia's Gender Equality Scorecard, released by Workplace Gender Equality Agency, February 2024
