The Government has introduced the Workplace Gender Equality Amendment (Closing the Gender Pay Gap) Bill (the "Bill"), which reforms the way gender pay gap data is reported.

While employers with more than 100 employees have had to report on their pay gap statistics for over a decade, as a result of the reforms, this data will now be published by the Workplace Gender Equality Agency (the "Agency"). The Bill attempts to put pressure on employers to take the gender pay gap within their organisation seriously as pay gap data for each employer will be publicly available.

The gender pay gap is the difference between the average pay of women and men across organisations, industries and the workforce as a whole. Currently, Australia's national gender pay gap is 14.1 per cent, and on average, women earn $263.90 less than men each week.

The gender pay gap in each State/Territory is as follows:

  • Queensland: 15.6 per cent;
  • New South Wales: 14.5 per cent;
  • Australian Capital Territory: 7.9 per cent;
  • Victoria: 12.1 per cent;
  • Tasmania: 8.4 per cent;
  • South Australia: 7.1 per cent;
  • Western Australia: 21.9 per cent; and
  • Northern Territory: 12.7 per cent.

Current framework

Currently, the Workplace Gender Equality Act 2012 (the "Act") requires employers with more than 100 employees, to lodge annual reports containing information relating to various gender equality indicators, including:

  • gender composition of the workforce;
  • gender composition of governing bodies of relevant employers;
  • equal remuneration between women and men;
  • availability and utility of employment terms, conditions and practices relating to flexible working arrangements for employees and to working arrangements supporting employees with family or caring responsibilities; and
  • consultation with employees on issues concerning gender equality in the workplace.

These reports are provided to the Agency, which then submits a progress report to Parliament every two years. The Agency also has the power to review an employer's compliance with the Act and seek further information from them.

If an employer does not comply with the Act or fails to provide their annual report to the Agency, the Agency can name them in their progress report, or publish their name on the Agency's website, or in a newspaper.

It is worth noting that due to the Respect@Work reforms brought in at the end of 2022, public sector employers with over 100 employees are now required to submit gender pay gap data (they had previously been exempt).

Proposed changes

As a result of a review of the Act, which made ten recommendations, the Bill proposes the following changes to the Act:

  • the Agency will publish an organisation's gender pay gaps on its website to accelerate action to close them;
  • the minimum standard that employers are required to achieve with respect to the gender equality indicators will be increased;
  • CEOs will be required to provide the Agency's Executive Summary and Industry Benchmark Report to all members of their organisation's governing body; and
  • the gender equality indicators will now also include sexual harassment, harassment on the ground of sex and discrimination (noting that employers were already required to report any sex-based harassment and discrimination to the Agency).

Key takeaways

As the title suggests, the reforms are aimed at closing the gender pay gap. The explanatory memorandum to the Bill confirms that the reforms are designed to "close the gender pay gap at work, including by boosting pay gap transparency and encouraging action to close gender pay gaps within organisations".

The key takeaway for employers is that the reporting data will be publicly available and accessible to current employees, prospective employees, suppliers, media and competitors. Accordingly, employers should review previous reports submitted to the Agency, along with current pay data to identify and address any concerns.

Bill is currently being debated before Parliament and will commence once it has been passed by both houses.