Does Gender Pay Gap legislation go far enough?

The labour government has announced its intention to bring in legislation requiring employers to publicly report their gender pay gaps.

The proposal initially requires only organisations with more than 250 employees to publicly report pay gaps; after four years, that would be extended to companies with more than 100 employees.

"We need to ensure we're staying in line with international standards to attract highly skilled women to New Zealand and do what's right as an inclusive and forward-thinking country,” Minister for women Jan Tinetti announced.

AIA NZ supports legislation

Over 100 large organisations have been voluntarily reporting gender pay gaps since the Mindthegap register was launched in 2022, including insurance provider AIA NZ who signed up to the register last year.

The company “is supportive of legislation being implemented to mandate reporting for all companies,” said Brynlea Hunter-Morpeth, Chief People & Culture Officer at AIA NZ.

“We know that publicly sharing gender pay gaps encourages the gender pay conversation and ensures that we hold ourselves accountable for addressing our current pay gap, so that organisations can commit to making improvements.”

Although 75% of the board, 60% of the executive team and 56% of the senior leaders at AIA are women, at 19.1%, AIA’s gender pay gap is more than double the national gender pay gap of 9.3%.

Hunter-Morpeth explained the issue didn’t lie with pay equity — women outnumber men at AIA NZ in all pay quartiles.

“This means we have a larger proportion of women in lower paying roles such as customer service, and a smaller proportion in higher paying roles like technology,” she said — but the organisation is committed to addressing that with a number of initiatives.

“These include ensuring women are part of interview panels, running unconscious bias training and female leadership programmes, as well as exploring internship programmes that support women studying in areas like STEM subjects.”

Transparency and equal pay

Diversity and equity leader Jo Cribb was quick to jump on LinkedIn to share the news: “After years of campaigning, it's heartening to see the government commit to pay gap reporting legislation. Addressing gender and ethnic pay gaps is something I hope is beyond politics. It is about fairness and equity. It's about the legacy we are leaving. Pay gaps are something our daughters and granddaughters should not have to contend with. Let's watch with interest as other parties announce their policies.

HR consultant Stephanie Love of Love HR said the proposed legislation is “exciting news” for many kiwis.

“Achieving transparency and equalling pay in all sectors can lead to easing increased cost of living pressures, among other benefits.”

And Brylee Tashman, Founder of international diversity company Bustle International, said it’s encouraging that the gender pay gap is being officially recognised.

“Change comes with one action and while it has taken far too long, it is a step in the right direction. The real change though will come when pay parity becomes mandatory for all organisations.”

Does the gender pay gap legislation go far enough?

While Diversity Works New Zealand welcomed Labour’s proposed legislation as a “first step,” Chief Executive Maretha Smit said she is concerned that the new law will not go far enough.

“It’s time for firm measures to bring visibility to pay gaps,” said Smit. “The real issue with pay gaps, even within gender, sits within the intersection with ethnicity.”

But d​iversity and Inclusion minister Priyanka Radhakrishnan said there needed to be more consultation before the government commits to implementing ethnic pay gap reporting, according to Stuff.

“It’s a bit more complex. Individuals can identify with multiple ethnicities, for example, and Stats NZ doesn’t have guidance on ethnic pay gap calculation. It’s not something that’s done much internationally,” she said.

More ‘red tape’ for private sector

However, Act party leader David Seymour told media the proposal was more “red tape” which he didn’t support.

“Jan Tinetti and Priyanca Radhakrishnan, neither of whom have any familiarity with the private sector, want to add to the burden of red tape and regulation,” said Seymour.

NZ businesses may not see this as an advantage, said Love, “and more as an additional compliance burden, however it’s widely understood that putting people first pays off in the long run. I’m glad to see Labour taking the lead, now we need the remaining political parties to follow suit.”