Bill to introduce reporting requirements for employers
The Federal Government has introduced a Bill requiring organisations with 500 or more employees to set and meet gender equality targets. The Workplace Gender Equality Amendment (Setting Gender Equality Targets) Bill 2024 (the Bill) proposes to introduce reporting requirements on large organisations to demonstrate measurable action and improvements towards gender equality in Australian workplaces.
Large employers should remain alert to any developments in the passage of this Bill. In this article we discuss what the Bill proposes to introduce, and what organisations should be thinking about in anticipation.
The Bill seeks to amend the Workplace Gender Equality Act 2012 (the Act) as part of Parliament’s ongoing efforts to close the gender pay gap and improve gender equality in the Australian workforce. It implements Recommendation 3.1a of the 2021 Workplace Gender Equality Act Review Report into gender inequality by introducing enforceable gender equality targets for certain employers.
Australia’s gender pay gap for 2023-24 was 22.1 per cent, with women earning an average of $231.50 less per week than men. Women also retire with 25 per cent less superannuation. These disparities highlight the pressing need for systemic action, which the Bill seeks to address by requiring large employers to build on existing gender equality strategies and policies tied to the Act’s six gender equality indicators (GEIs).
According to the Bill’s Explanatory Memorandum, if passed, the gender equality targets scheme would be the first of its kind globally, and “Australia would pioneer the path to accelerate gender equality through a targets scheme that seeks to motivate action and embed systemic cultural change in large employers.”
Currently, the Act requires relevant employers to submit annual reports addressing the six GEIs and to have policies supporting these indicators.
If passed, the Bill would introduce a new requirement for organisations with 500 or more employees to commit to, achieve, or at a minimum improve on, specific gender equality targets in relation to the GEIs. Employers would have three years to achieve, or improve on, the selected targets and, at the end of the reporting period, they will select new targets for the next three-year cycle.
The Minister for Women will set “a menu” of targets in relation to the GEIs for organisations to choose from and implement. The Minister will also have the power to specify rules in relation to the selection of targets, including the category of targets that can be selected and how many of the targets to select.
The issues the targets will focus on include:
The targets can include both numeric targets such as reducing the gender pay gap and improving gender equality on board and workforce composition. They can also include action-based targets such as introducing programs and initiatives.
When selecting targets, employers will be assisted by the Workplace Gender Equality Agency to set and achieve their objectives. Employers will also be required to consider the selection of classes of targets as well as the level of improvement expected in meeting the targets.
Under the arrangements proposed by the Bill, employers would propose their targets and provide a baseline report of their current status in their annual public reports required by the Act currently. At the end of each three-year cycle, progress will be measured against the baseline.
Positive movement from the baseline towards the target will be sufficient to demonstrate improvement and satisfy the requirement for compliance at the end of the three-year target cycle. In other words, where an employer has implemented an ambitious target and fails to meet it, they will still be acknowledged for the efforts they make towards progress against the target.
Where an employer has failed to meet a target or demonstrate that they have improved against the target without reasonable excuse, they will have failed to comply with the Act. This will be assessed at the end of the three-year target cycle against the employer’s baseline report.
As a result, the Workplace Gender Equality Agency may name the employer and set out the details of non-compliance in a published report.
The Bill was introduced to the House of Representatives on 20 November 2024 and referred to the Senate Finance and Public Administration Legislation Committee, which is due to report by 30 January 2025.
While the Bill is still under review, employers can take proactive steps to prepare for its potential passage by:
Annamarie Rooding is a Partner, Chris Shelley is a Special Counsel, Sarah Clarke is a Partner, and Sienna Hilson is a Solicitor, and Isabelle Binsted is a law clerk, all in the Employee Relations & Safety team at King & Wood Mallesons in Melbourne.
