THE HON TANYA PLIBERSEK MP
DEPUTY LEADER OF THE OPPOSITION
SHADOW MINISTER FOR EDUCATION AND TRAINING
SHADOW MINISTER FOR WOMEN
MEMBER FOR SYDNEY
26TH ANNUAL KINGSLEY LAFFER MEMORIAL LECTURE
“MAKING WORKPLACES WORK FOR WOMEN”
THURSDAY, 11 OCTOBER 2018
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Good evening everyone.
I would like to acknowledge the traditional custodians of the land on which we meet today, the Gadigal people of the Eora nation, and to pay my respects to their elders, past, present and emerging.
Thank you very much to Rae Cooper for the kind introduction and for bringing us all together to speak about such an important topic – women’s rights at work.
Thank you also to Marian Baird and all the other members of the Women Work and Leadership Research Group for the wonderful work you are doing.
It’s a great privilege to be delivering this lecture in honour of Kingsley Laffer a great figure in this university’s history and in the discipline of industrial relations.
I’d like to think that he would be glad a fellow member of the Fabian Society of NSW is addressing you from this podium.
In preparing for this lecture I came across an old 1949 pamphlet from the Fabian Society of NSW put out when Kingsley was Chairman of the organisation called “Towards a Socialist Australia”.
The pamphlet concludes with the rallying cry: “The Australian Labor Party should put forward a socialist short-term programme for the next five years!!”
Kingsley may be disappointed that we haven’t yet achieved socialism in our times, but if you listen to Scott Morrison or the Daily Telegraph – Labor’s not far off!
The title of my lecture today is “Making workplaces work for women.”
I want to focus especially on gender pay equity.
Australian women effectively work the first two months of every year for free compared to their male colleagues.
So many of the issues women face at work – discrimination, being shut out of leadership, lack of access to flexibility, the motherhood penalty, insecure work, even sexual harassment – are either drivers or outcomes of pay inequity.
That pay inequity drives the huge gap in women’s super.
And it’s one of the reasons why older, single women are one of the fastest growing groups of people falling into homelessness.
The gender pay gap is one of the most persistent forms of inequality in the Australian economy.
As Justice Mary Gaudron famously said in 1979: “Equal pay was ‘won’ in 1969 and again in 1972 and 1974. Yet we still do not have it.”
Justice Gaudron could just as easily say that today – forty years later.
The Workplace Gender Equality Agency says that the gap has been stuck between 14 and 19 per cent for the last twenty years.
But that doesn’t mean we were doing a great job closing the gap before then.
1994 is just when the data set we use started.
The reality is that we haven’t made any substantial and sustained progress closing the gender pay gap for about four decades.
Instead of taking serious action, we celebrate when it’s trending down and we scratch our heads when it’s creeping up.
That’s why the claims made in the past few weeks by the Prime Minister and the Minister for Women and Industrial Relations – that the gender pay gap is closing and that the Coalition deserve the credit – are so irresponsible.
It points to a fundamental misunderstanding of what drives the gender pay gap and where it is headed – not that surprising from the party that didn’t have a single MP speak on the gender pay equity private members business I initiated in Parliament last month.
The Prime Minister recently tweeted that the gender pay gap increased to 17.2 per cent when Labor was in government and that under his government it has fallen to 14.5 per cent (conveniently forgetting that it reached its highest point in twenty years – 18.5 per cent – under the Liberal government).
Trying to politicise fluctuations in the pay gap won’t fix it.
And claiming premature success will only lead to a failure to act.
So, what’s actually happening with the gender pay gap?
Well, as it turns out, the ABC’s Fact Checker made a forensic inspection of the Prime Minister’s statements last week.
The verdict was clear – claiming that the gender pay gap had closed under the Coalition’s policies was serious overreach.
The experts consulted in the ABC’s analysis said “the current government could not claim credit for decreasing the gender pay gap, and that the only government measure that may be responsible for narrowing the gap was the gender pay reporting measures legislated by the former Labor government”.
As the Minister for Women who initiated those changes it’s great to see they’re making a difference.
Importantly, the fact check also pointed to how misleading the numbers can be.
The standard measure of the gender pay gap is currently at a record low of 14.6 per cent.
But, fourteen years ago the gender pay gap also broke below the 15 per cent mark.
From what was then a record low, it climbed steadily on the back of the mining boom to almost 19 per cent.
As the mining boom has eased off, so has the pay gap.
But, now’s not the time to break out the champagne.
As Doctor Rebecca Cassells told the ABC – the gender pay gap follows trends in the economy and increases and decreases are largely linked to economic conditions.
When the economy is booming, it tends to widen, and when there are downturns, it tends to close.
This is because men typically work in industries that have greater exposure to upturns and downturns, such as mining and construction.
During the mining boom, we saw significant wage increases.
There were benefits across the whole economy, but the pay rises were focused on male dominated sectors – engineering, construction, transport and logistics.
83 per cent of jobs in the mining sector are held by men.
88 per cent of construction employees are men.
Wages in the mining sector grew on average six per cent each year during the mining boom but have plummeted to one per cent a year since 2014.
A clear picture emerges if you look at wage growth during the period when the pay gap was rising – which corresponds closely with the mining boom – compared to the period since the pay gap began falling (CHART).
The decline in average wage growth for men has been particularly severe, falling from 4.5 per cent during the boom to 1.8 per cent in the past four years.
Women’s average wage growth has also fallen well below the long term average but has still experienced some growth.
For example, over the past four years there has been relatively high growth totalling 14.9 per cent in weekly earnings for women in health care and social assistance; of note because around 22 per cent of all working women are employed in this sector.
A driver of wage growth in this sector is the pay rises being phased in because of the Social and Community Service Workers equal pay case; a case that succeeded because the Gillard Government committed $3 billion to help meet the pay rises that flowed from the equal remuneration order.
The SACS judgement ordered real wage increases of between 23 and 45 per cent over eight years.
Another significant factor in the higher growth in women’s earnings is the minimum wage increases delivered in the past two annual wage reviews.
These decisions have meant wages for low income earners have grown faster than trend across the entire labour market.
Because women are more likely to be award-reliant and in receipt of the minimum wage, they are benefiting from these changes.
Unfortunately, for many workers, these gains in the minimum wage will be eroded by cuts to penalty rates, which will disproportionately impact women.
Labor has supported unions in recent years by making unprecedented submissions to the Fair Work Commission to support increases in the minimum wage, because of our concerns about low wage growth affecting workers and the economy.
In comparison, the Turnbull Government refused to support an increase to the minimum wage, and, extraordinarily, justified it because low paid workers “are often found in high-income households” – then Minister for Women, Michaelia Cash couldn’t say how many were in this situation.
Apparently, women didn’t need a pay rise because their husbands and fathers might be earning more.
And of course Labor has pledged to restore penalty rates to 700,000 low paid workers; another move opposed by the Government.
What does this mean? The gender pay gap is narrowing largely because of record low wage growth and stagnant male wages, not because of any action taken by the Federal Government; in fact, the Government’s actions have generally sought to reduce wage growth
The answer to closing the gender pay gap certainly isn’t to pay men less.
Will the current decline in the pay gap continue?
In his keynote address to the Gender Pay Symposium held here in late September, Fair Work Commission President, Ian Ross, said that “it is likely [the gender pay gap] will widen again absent any measures to stop it” and that “the gender pay gap is not going to disappear on its own.”
The recent improvement is best thought of as a correction driven by the business cycle and labour market trends.
Some of the improvement can be accounted for by Labor’s introduction of company gender pay reporting to the Workplace Gender Equality Agency, which began in 2014, but this policy alone won’t close the pay gap.
Many of the women who have joined the labour market as part of the recent surge in women’s workforce participation have entered into relatively low paid health, disability and aged-care jobs where the rollout of the NDIS is driving jobs growth.
Major jobs growth is also expected in STEM sectors. These jobs command higher pay, but 84 per cent of Australians with STEM qualifications are men.
These trends point to the gender pay gap widening again unless we act to address its underlying causes.
KPMG identified three of those causes in their report for the Workplace Gender Equality Agency and the Diversity Council of Australia, She’s Price(d)less.
First, industrial and occupational segregation – the fact that women and men tend to work in different jobs and sectors with different pay rates.
Second, the impact of care responsibilities, in terms of time out of the workforce or working part time.
And third, flat out gender discrimination.
Of the three factors, discrimination, sadly, is the largest contributor, accounting for 38 per cent of the gender pay gap.
The impact of discrimination has increased since KPMG’s first study in 2009.
Industrial and occupational segregation combined account for 30 per cent of the gender pay gap.
Part-time work and years out of the workforce account for around 25 per cent.
The underlying causes of the pay gap are complex and interconnected, but there are things we can do to address them.
Discrimination and the like-for-like pay gap
The gender pay gap is often confused in the media with like-for-like pay discrimination.
The like-for-like pay gap is the situation when the bloke sitting across from you, doing the same job you are, is being paid more.
It may be about unconscious bias, or it might be more overt.
I imagine we all know women who suspect or have found out that their male colleague was earning thousands more than them for no apparent reason.
Last year, 122 Australian business leaders pledged to close the gender pay gap in like-for-like roles within their organisations.
It was a welcome commitment, but it’s also a concern when over thirty years after sex discrimination laws were put in place, business leaders can earn plaudits for simply committing not to break the law.
Meanwhile, reporting to the Workplace Gender Equality Agency shows that 37 per cent of companies have conducted a gender pay analysis.
It’s fairly safe to assume that most would have found some form of gender pay gap.
But only a third went on to identify the cause of their pay gap.
And just one in five actually took action to correct any like for like gaps.
We need to have a zero tolerance approach to like-for-like pay discrimination.
A major barrier to addressing pay discrimination is the lack of transparency and climate of secrecy around pay.
It’s telling that in the public service, where everyone knows what level you are and what the pay rates are at each level, the pay gap is just 10.5 per cent.
For the private sector, it’s 18.4 per cent.
Research indicates that over half of Australian employers discourage their staff from telling their colleagues what they get paid.
Pay secrecy clauses are most common in the financial services sector, which, not so coincidentally, has the highest gender pay gap – 27 per cent.
That’s why Labor has committed to ban pay secrecy clauses and give workers a right to disclose their pay if they wish to.
We’ll also make all companies with over 1,000 employees publish their gender pay gap. These companies already report their pay data to the Workplace Gender Equality Agency, so there is no additional regulatory burden – just more transparency.
It’s time for more accountability, because countries with more transparency have smaller gender pay gaps.
The Motherhood Penalty
Then we have the grim reality of the motherhood penalty.
The gender pay gap substantially increases after women take time out of work to care for children.
Australia has one of the highest rates of women in part-time work in the world.
Women are twice as likely to be working part time as men.
ABS data shows that when women work part time, they don’t just earn less because they’re working fewer hours; they also receive lower hourly pay than their full-time counterparts.
Australian workplaces need to get much, much better at supporting employees who are parents or carers.
And for Australia to achieve gender equality in the workplace we also need to change the way we share family responsibilities and unpaid caring work.
When Labor was last in government we legislated protections against discrimination on the grounds of family responsibilities and we introduced the right to request flexible work.
Labor’s introduction of Paid Parental Leave was a crucial enabler of the current rise in women’s workforce participation by making it so much easier for women to remain attached to the workforce when they have children.
But there is still far more work that needs to be done
Just last week Labor announced the biggest investment in early childhood education in our nation’s history.
We’ve said we’ll commit permanent to preschool funding for all four year olds and extend the program to cover all three year olds.
We’ve also said we’ll:
- pay superannuation on Commonwealth paid parental leave
- provide $15 million to reinstate the Time Use Survey so we have a better understanding of the value of unpaid care work; and
- improve access to flexible work in the Australian Public Service.
All important measures to help remove that motherhood penalty, but we also have to have measures like Dad and Partner Pay, which reflect the importance of sharing parenting responsibilities.
The final significant underlying driver of the pay gap is workforce segregation.
Labor has been hard at work on policy solutions in this area.
Labor Senator for NSW, Jenny McAllister, has conducted a Senate Inquiry into gender segregation in the workforce and its impact on women’s economic security.
This Inquiry has found that gender segregation is deeply entrenched in the Australian labour market.
We’re all familiar with vertical segregation – the “glass ceiling” effect where women are under-represented in management and leadership positions.
Horizontal segregation, or “glass walls” are also a problem.
This happens when women or men become over-represented in certain occupations or industries.
Women are more likely to be nurses, men are more likely to surgeons.
In Australia, women are increasingly concentrated in low-paid health care, social assistance and education sectors while men dominate an array of higher paid sectors including transport, construction and mining.
There are different ways we can tackle workforce segregation.
When I was last the Minister for Women, we launched a number of projects to smash glass ceilings.
We set targets for women’s representation of government boards – and met them two years ahead of schedule.
We set up Boardlinks to connect talented women with board opportunities.
And we funded scholarships for women to do the Australian Institute of Company Director’s board training program.
Occupational and industry segregation begins with the subjects we select in high school and the courses we study at TAFE or university.
We need to do more to encourage girls to enter non-traditional trades and professions, including in STEM jobs – indeed, today is International Day of the Girl and the theme is A Skilled Girlforce.
We need to do more to encourage boys to work in education and care sectors.
In my job I get to meet with a lot of terrific young apprentices; including many young female apprentices in traditional male trades like metal work and electrical engineering.
Almost all of them tell me they’ve been discouraged from entering their profession – by either their teachers, their parents, guidance counsellors or friends.
Yet they love what they do and they were determined to forge a career.
We need to encourage these young women and I pay tribute to many unions like the AMWU, CFMMEU and the ETU who are actively encouraging female apprentices into their traditionally male dominated trades, as well as many of the employer groups.
It’s not enough though, to just encourage girls to move into high paid occupations.
Undervaluing “women’s work”
One of the reasons pay is low in female-dominated industries is because as a society, we don’t value care work – the jobs traditionally thought of as “women’s work” – highly enough.
Take early childhood educators.
97 per cent of them are women.
They’re doing the hugely important, demanding job of educating and caring for our next generation.
Yet they’re some of the worst paid workers in this country.
The simple fact is that Australia’s equal pay laws are not working.
There was not one single successful claim for equal pay under John Howard’s industrial relations regime.
When Labor was elected in 2007 we changed the law and the Social and Community Service Workers Case was run and run successfully; as already noted with the support of the Gillard government.
However the recent failure of the equal pay case for early childhood educators run by United Voice and the AEU has shown that equal remuneration laws are not acting effectively to deliver pay increases for women in low-paid industries.
The Fair Work Commission has re-interpreted the Act as requiring a male comparator to prove gender based undervaluation, an interpretation not applied in the SACS case.
Experts have long acknowledged that a male comparator may make sense in a like for like pay discrimination case, but it sets up almost insurmountable barriers when you’re dealing with industry wide gendered undervaluation.
These cases are high cost, complicated and lengthy and have only succeeded in the past when the government has intervened in favour of the application.
The President of the Fair Work Commission has acknowledged that there is a “lack of coherence around the legislative framework in relation to the gender pay gap” and highlighted that gender equity isn’t a clear objective of the Act.
I would go further.
The equal pay provisions of the Fair Work Act as they are currently being interpreted are broken.
They can’t and won’t deliver the increases in women’s pay that we need to see to close the gender pay gap.
It needs to be fixed.
What’s more, under the Liberals the necessary expertise in equal pay has been lost from the Commission.
That also needs to be fixed.
It’s not just the early childhood educators doing the crucial work of caring for and educating our children.
We need to deliver a better deal for aged care workers looking after the people we love.
We need a better deal for the highly skilled carers delivering the ground-breaking NDIS.
What will Labor do?
Pay inequity is a complex issue.
But Labor wants action on gender pay equity to be a hallmark of the next Labor Government.
We’ll make it a priority for the whole of government:
We’ve already committed to:
- A package of measures to boost pay transparency;
- Deliver $400 million to help women build their superannuation balances;
- Reverse cuts to penalty rates;
- and provide 10 days paid domestic violence leave .
These policies will build on the achievements of the last Labor government, many of which I initiated when I was last Minister for the Status of Women;
- Australia’s first government paid parental leave scheme;
- gender pay gap reporting to the Workplace Gender Equality Agency;
- setting targets for women on government boards;
- strengthening sexual harassment protections;
- the right to request flexible work; and
- $3 billion in pay increases for the mostly female social and community service workforce.
All this was achieved in just over six years of government.
After five years in power, the Abbott-Turnbull-Morrison Government still hasn’t released its long promised women’s economic security statement.
In that time, they’ve tried five times to slash paid parental leave, opposed increases to the minimum wage that disproportionately benefit women and supported cuts to penalty rates.
A major reason why Labor is the party that best represents Australian women is because we’ve got so many outstanding women in our ranks.
But also because the men in our party understand the importance of gender equality and women’s representation.
Almost fifty years after first winning equal pay in principle, we need to get real about delivering it in practice.
Only Labor is committed to doing that.