Gender pay gap lower in the public sector, but some states buck the trend

By Stephen Easton

Wednesday September 6, 2017

In case you missed it, September 1 was Equal Pay Day, an effort to raise awareness of the fact that women earn less than men on average — not so much through direct discrimination, but due to other factors listed by the organisers like lower pay in sectors where women predominate and the fact that “more men work in better-paid sectors and at higher levels in better-paid jobs”.

These factors that explain why a gap has persisted, despite equal pay being legislated decades ago by the Whitlam government, are also evident in public sector workforces. Most health and human services staff are women and these jobs are also among the lowest-paid, for example. The typical public service profile is mostly women overall, but with more men in the most senior jobs.

Compared to the private sector, however, governments seem to be doing more to break down the divide between the typical working lives of Australian men and women than companies in the private sector — which is not surprising given they have generally made efforts to be model employers on issues like diversity and equal opportunity over the years.

The most recent Australian Public Service remuneration report revealed the gap in the federal workforce for the first time. The report said the average base salary of women in the APS was 8.6% lower than the men, compared to a 19.3% gender pay gap in the private sector. Across the country, the gap in the public sector is 10.8%.

The overall combined national gap has dropped one percentage point from 16.3% to 15.3% in the past year, according to more recent figures released by the Minister for Women, Michaelia Cash, to mark Equal Pay Day.

The South Australian government has looked into its the gap for the first time and found this situation is reversed, as InDaily reported this week.

Overall, the state has a lower gap than any state or territory, at 9.8%, but in its public service it stands at 15%, closer to the national average across the whole economy. This is “bizarre and disappointing” in the view of the state’s equal opportunity commissioner Niki Vincent, but she applauded the government for undertaking the study.

As with other jurisdictions, the SA public service is mostly made up of women, and the pay gap shows they generally aren’t in the highest-paying jobs. The good news is the pay audit also found the SA public service gap has been decreasing by about 1% a year.

In Western Australia’s public service — which is currently in the throes of major machinery-of-government changes and sweeping administrative reforms accompanied by a pay freeze and the looming introduction of performance pay for senior executives linked to whole-of-government KPIs — the gender pay gap is also quite large by public sector standards.

The government last reported on the issue in 2015, and provided some advice on how public service agencies could improve pay equity at the same time. In June 2014, the gap was 16.3% and had dropped 0.6% over the preceding year — although this figure includes data for permanent part-time employees while the standard used elsewhere is average weekly full-time earnings.

The more recent data shows WA’s overall gap is the highest in the country at over 22%, according to a range of pay gap statistics the Workplace Gender Equality Agency reported for Equal Pay Day.

When the union goes into bat for SES pay…

Incidentally, the WA government’s plan to make the remuneration of its senior executives partly contingent on performance against whole-of-government targets has come under fire from the Community and Public Sector Union’s WA branch.

Premier Mark McGowan previously said he wanted to cut 20% of SES headcount and link 20% of the remaining senior executives’ salaries to KPIs for government like reductions in methamphetamine use, cases of diabetes, and domestic violence incidents. Holding agencies to account makes sense, but not individuals, the union argues:

“In terms of Key Performance Indicators for personal performance, the CPSU/CSA is … of the view that they are unnecessary and not targeted towards community needs or service outcomes.

“Key Performance Indicators for agency performance and service review is a different matter and have been in existence in the West Australian public sector for over 20 years. They are capable of review, frequently audited by the West Australian Auditor General and agency-specific.

“In this way, they are able to be adapted according to need and sophisticated enough to truly focus on what needs to be measured, such as the effectiveness of a service to the community.

“It must also be noted that responsibility for the outcomes which are measured by a Key Performance Indicator (whether personal or agency-wide) ultimately rests with the relevant Minister. This is especially important for the government to consider when deciding whether to implement Key Performance Indicators for heads of agencies, given the role of the public sector is to implement government policy.”

The CSA has published its submission to the review online.

Correction: an earlier version of this article stated the CPSU submission was not available online.

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