Media Release by The Hon Tanya Pibersek MP

Gender pay gap costs $93 billion each year

The research, The impact of a sustained gender wage gap on the Australian economy, commissioned by the Australian Government’s Office for Women, identified reasons for the gender pay gap and measured the impact of the gap on economic growth.NATSEM found that ‘being a woman’ was the single largest reason for the gender pay gap (60%).  This includes complicated factors such as women’s choices of careers, jobs and work hours, consideration of caring responsibilities, women’s work motivations, bargaining power and appetite for risk, as well as discrimination against women that occurs in the workplace.

Other contributing factors such as industry segregation and labour force history impact on the gender pay gap.

The Government is determined to improve women’s economic security and has already taken several critical steps to achieve greater equality for women, including:

  • Changes to the Fair Work Act to extend the equal remuneration provisions to include the right to equal pay for work of equal or comparative value: a more generous test allowing comparisons between comparable categories of work where the female dominated category may have been historically under-valued.
  • A special bargaining stream for the low paid that will benefit many women in low paid sectors, such as cleaning, childcare and the community sector.
  • 12 months unpaid parental leave for new parents – one of the ten legislated National Employment Standards. Like annual leave, public holidays and redundancy pay, unpaid parental leave is guaranteed to all employees covered by the new national Fair Work system.  
  • A new right to request flexible working arrangements on return to work. New parents can also request to extend parental leave by a further 12 months.
  • A process for a pay equity test case under the new equal remuneration provisions of the Fair Work Act for the social and community services sector. This case was lodged by the ASU on 11 March 2010.
  • Improvements to child care including increasing the Child Care Tax Rebate to 50%.

The most important step in giving women the opportunity to re-enter the workforce is the historic introduction of Australia’s first Paid Parental Leave scheme.

The Government will soon introduce legislation so that from 1 January 2011, eligible employees will receive up to 18 weeks of taxable payments paid at the level of the National Minimum Wage.  The Paid Parental Leave scheme will foster increased workforce participation by helping women maintain their careers. This will support stronger families and give children the best start in life.

The full report can be found at The impact of a sustained gender wage gap on the Australian economy.