Gender pay equity reform in Australia: what is the way forward?

• Author: Smith, Meg
• Position: Contributed Article

Abstract

Pay equity reform in Australia has occurred in three stages. The first comprised the adoption of equal pay principles in 1969 and 1972. The second involved a legislative entitlement to equal remuneration, introduced in 1993 and retained by the Workplace Relations Act 1996. Despite the existence of such legislative provisions, they remain under-utilised. The third stage involved the development of new equal remuneration principles at a state level. These principles represented an advance for women employed in some spheres, as they elevated undervaluation, as opposed to discrimination, as a key litmus test in assessing claims for equal remuneration. The Work Choices amendments excluded specifically these initiatives while at the same time maintaining a nominal entitlement to equal remuneration. This pattern of gender pay equity reform has important consequences for the recasting of federal labour law, specifically if the available institutional measures are to enable aggregate and collective remedies.

Introduction

Federal labour law is in a period of transition--caught between the seismic shift imparted by the Howard Government's WorkChoices amendments and the commitment of a newly elected Labor government to dismantle aspects of that regime. The first stage of reform evident in the Workplace Relations Amendment (Transition to Forward with Fairness) Act 2008 (Cth) did not explicitly address the issue of equal remuneration. This was an unsurprising outcome because the government's primary intention was to excise Australian Workplace Agreement (AWAs) from federal labour law (Australian Labor Party 2007a; Australian Labor Party 2007b). The second stage, the Fair Work Act 2009 (Cth) explicitly deals with equal remuneration, but what remains uncertain is the ability of these legislative amendments to deal with gender pay equity in a robust and sustained way. A more sustained debate about gender pay equity is required, one that is cognisant of the strengths and weaknesses in previous stages of reform. While public scrutiny has focused on the fate of state industrial jurisdictions and the ascendency of organised labour, there has been less public attention paid to the government's program to reform current equal remuneration provisions.

Detailed attention is required and not simply because of WorkChoices. There has been glacial progress in Australia's gender pay equity ratios since the industrial breakthroughs of the late 1960s and early 1970s (see Figure 1). Hourly earnings data for private sector, non-managerial, adult full time employees reveal a steep improvement in gender pay equity ratios between 1967 and 1980. Since 1980, the improvement in gender pay equity ratios has been far less obvious and subject to fluctuation. The gender pay equity ratio increased from 64 per cent in 1967 to 80.1 per cent in 1980--an increase of 16.1 percentage points over a 13 year period. In the period 1980-2006, the ratio increased only 5.0 percentage points--from 80.1 per cent to 85.1 per cent, although it peaked at 88.9 per cent in 1994 and was higher in 2000, 2002 and 2004 than that in 2006 (1).

What understandings do we have of this stalled nature of reform? Clearly there are multiple, diverse variables at work including factors routinely associated with inequity--the gendered valuation of work, occupational segregation, women's representation in decentralised bargaining and the impact of family and household on women's capacity to participate in higher paid employment. These dimensions intersect with the inadequacy of minimum wages, the falling relativity of which has impacted on both women and men, particularly those in part-time employment (Whitehouse 2003; Preston, Jefferson and Seymour 2006).

What is examined here is the effectiveness of particular and past stages of equal remuneration reform in labour law. A focus for this examination is the three stages in pay equity reform in Australia that have occurred from the end of the long post-war boom. The first comprised the adoption of equal pay principles in 1969 and 1972 by the then Australian Conciliation and Arbitration Commission (ACAC), which were tested by way of comparable worth proceedings in 1986. In nominating these principles as a 'first stage', it is acknowledged that state industrial jurisdictions took limited action prior to this point, while particular trade unions campaigned for equal pay in the 1930s as well as the 1950s (Ranald 1982; Curthoys 1988). The second stage involved a legislative entitlement to equal remuneration, introduced to federal labour law in 1993 and retained by the Workplace Relations Act 1996 (Cth). Despite the existence of such legislative provisions, they were under-utilised: since their inception only one case proceeded to final arbitration. The third stage involved distinct initiatives in gender pay equity reform developed in two significant state industrial jurisdictions in Australia--initiatives that were proscribed by federal labour law amendments in 2005. Each of these stages is reviewed to identify the arguments about how gender equity might be achieved. This review informs a final but preliminary discussion about the shape and content of new equal remuneration provisions in recast federal labour law.

[FIGURE 1 OMITTED]

Source:

1967-1972 Commonwealth Bureau of Census and Statistics Survey of Weekly Earnings and Hours, Cat. no. 6.1.

1975 Australian Bureau of Statistics, Earnings and Hours of Employees, Distribution and Composition, Cat no. 6.52.

1976-1981 Australian Bureau of Statistics, Earnings and Hours of Employees, Distribution and Composition, Cat no. 6306.0.

1983-1994 Australian Bureau of Statistics, Distribution and Composition of Employee Earnings and Hours, Cat no. 6306.0.

1995-2006 Australian Bureau of Statistics, Employee Earnings and Hours, Cat no. 6306.0.

The 1969 and 1972 Equal Pay Principles and the 1986 Comparable Worth Proceedings

The 1972 equal pay for work of equal value principle (2) followed the 1969 equal pay for equal work principle (3), the latter having broken through the institutionalised sexism that had marked early Australian wage fixation. The task of the 1972 principle was to remedy key deficiencies in its 1969 forerunner: the 1969 principle was confined to women and men engaged in similar work and did not extend to women engaged in predominantly feminised work. This fault remedied, the distinctiveness of the 1969 and 1972 reforms lay in the institutional arrangements through which gender pay equity relief could be sought and granted. Applications were directed through a centralised system of industry awards, itself a function of Australia's legacy of centralised wage determination. Gregory and Duncan (1981, p. 426) assert that the improvements in Australia's gender pay equity ratios in the period 1970-1980 could only be sourced to the institutional measures introduced in 1969 and 1972, as they extended far beyond the relative wage changes that could be attributed to demand and supply. Similarly, the improvement in Australia's gender pay equity ratio arose from changes in legislation and the wage determinations of industrial tribunals rather than sudden and differential improvements in the human capital among men and women in a short period of time (Gregory 1999, p. 277).

The widened scope of the 1972 principle held significant promise for Australian women, because it provided Australia with a set of institutional measures, unmatched in other national jurisdictions, to promote gender pay equity. Yet the theoretical equality in pay rates was not matched in practice (Gaudron and Bosworth 1979, p. 169). The plateau in gender pay equity ratios following the surge in women's wages in the wake of the 1972 decision (Kidd and Meng 1995, p.25) reflected a failure to deal comprehensively with more endemic work value issues and the lack of impetus across the union movement to formulate and campaign around contested pay equity claims.

This failure continued a long history of assumptions of women's work being semi-skilled or unskilled and the difficulty that industrial tribunals have had in properly valuing the 'skills exhibited, acquired and used by women in traditional occupations' (Scutt 1992, p. 282). Such a strategy did not confront the segregated nature of the labour market and was incapable of countering the subtle, structural barriers to the industrial recognition of work value. The remedy provided by such strategies all too often focused on women gaining equality through matching the ideals and attributes of a masculinist standard. A case in point here is the manner in which the metal trades fitter was used as a benchmark by tribunals in wage setting. The approach of the industrial parties and the industrial tribunal to the determination of equal value was nebulous and incomplete--an institutional state of affairs that shaped the 1986 comparable worth proceedings, a key milestone in the testing of the 1972 principle.

The 1986 comparable worth case arose from an application for wage increases for nurses employed under the Private Hospitals' and Doctors' Nurses (ACT) Award 1972 (4). The applicant unions, the Royal Australian Nursing Federation (RANF) and the Hospital Employees' Federation of Australia (HEF), supported by the Australian Council of Trade Unions (ACTU), sought a series of rulings from the ACAC, including one that the Commission apply the 1972 principle via the concept of comparable worth (5). Following the rejection of their application in pursuit of comparable worth, the union pursued the case through the anomalies and inequities provisions of the prevailing wage fixing principles (6).

The comparable worth proceedings concerned not only the application to Australian labour law of the concept of comparable worth, but also the continued availability of the 1972 principle in the wake of changes to wage policy, including the wage fixing principles introduced by the 1983...