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Senate Estimates: Workplace Gender Equality Agency - changes to reporting requirements

Estimates & Committees
Larissa Waters 26 Feb 2015

Senator WATERS: Welcome to WGEA and the department. Hello minister! I also place on record, much like Senator Moore did, our praise and best wishes for Helen Conway who, obviously, is moving on. I am sure she will continue to do wonderful work. Please pass that on on behalf of the Greens.

I want to start off with the changes that were announced yesterday—the instrument—which I have had a chance to read quite closely and which I had the benefit of a departmental briefing on last night. Thank you to Ms Wood for taking the time to do that. I do have some follow-up questions, some of which will not be a surprise. Hopefully, you have had the chance to reflect on the unresolved issues and might be able to assist me now.

I will just start off on the applications and interviews for managers. I am interested in the quantum of people who might fall into that category. You talked about the cost of gathering that additional data; you had aggregated it and I am interested just in the cost of applications and interviews for managers as opposed to non-managers.

Ms Wood : We have asked the agency, and discussed today, the number of employees covered by the reporting arrangements who would be in the manager category. An estimate is that it is about one quarter, but we will have to take the precise figure on notice.

Senator WATERS: Okay, approximately one quarter of the total sample?

Ms Wood : Yes. And the total is around 3.9 million.

Senator WATERS: So it is about one million people that we are talking about. And were you able to progress the question of cost?

Ms Wood : No, we have a total cost but we do not have it broken down yet.

Senator WATERS: Thank you for continuing to look at that for me. I am also interested in the definition of 'promotion'. My concern is that when the proposal to drop the data collection of applications and interviews was announced yesterday that it might actually flow into people who are already within an organisation and who might be applying for and interviewing for something that is considered a promotion or, perhaps, is a more senior role but not directly reporting to their current role. I was interested to know from anyone who is able to tell me the definitional approach to promotion and whether you think applications for and interviews for promotion would still be captured?

Ms Beattie : A promotion refers to moving to higher duties. In whatever way that happens—whether that be through a formal interview process or being moved on in an informal way—that would be something we would need to work through when it comes to the implementation of those reporting matters—to clearly define that. But we have not gone through that process yet, given we have only just had certainty on the LI. That is something to be worked through over the next little while.

Senator WATERS: I will await the confirmation, but I will proceed on the understanding that applications for and interviews for a role within an organisation will not need to be reported on, and that it will only be those folk who are actually successful in receiving a promotion that employers would have to report on.

Were the effects that might have on studying where the glass ceiling kicks in considered in any part of the decision-making process?

Ms Wood : I think the approach—and, again, this was discussed extensively with the agency in coming up with the policy options that are reflected in the legislative instrument—was to look at which data is going to be the most robust. Certainly, we can have more confidence in the outcomes data—the appointments, promotions and resignations—than in the process data, because that is captured in systems already. Again, it came back to that idea of balance. We want data that provides insight—and that data will definitely provide insight into what is happening in organisations—and data that will be a catalyst for an employer who identifies they have an inequality or a problem actually to then go and look at their own practices. So, if they found that they were seeing a big disparity in appointments and promotions, or resignations, they would actually need to look at their own practices, which could well include looking at their interview and application processes, to actually unpack what is happening in their organisation. Again, it comes back to that idea that the primary purpose of the data is for employers to take action and to inform them in a way that enables them to do that.

Senator WATERS: I understand that, but I guess the example I conceive of is that if you are just tracking promotions data you might, for example, have a fifty-fifty gender split of folk you are promoting—which might, on its face, seemed like a great outcome. But if you are tracking the applications and interview stage, perhaps you have 90 per cent women applying for those promotions and yet a much reduced proportion of those women then being successful in getting the promotions.

My point is that I think the applications and interview stage tells the full story. I am concerned that we are now going to lose that data collection, given the legislative instrument that was announced yesterday.

Ms Beattie : I think I can answer that. If you have a look at the promotions combined with the actual composition, resignations and appointments, plus the company's specific pay-gap data, you get a pretty robust picture of your gender equality performance. Particularly, if you look in there by certain manager categories you are actually going to be able to see how many men and women sit in those roles; at what rate they are moving through the organisation, which is obviously the promotions piece; at what rate you are bringing them in, which is the appointments piece; and, obviously, at what rate you are losing them, which is the resignation piece.

That is leaps and bounds beyond where employers have been, and the agency feels that it gives a robust, accurate picture of how well employers are realising the potential of men and women in their workplaces.

Senator WATERS: In the consultation process—less so in the surveys and more so in the broader roundtables, so the more qualitative consultation that you did—I am interested in whether any of the participants in those consultations pushed for a change to the threshold of the size of employers that the rules apply to?

Ms Wood : No, not with that issue. We did not go out to discuss that issue, but no-one raised that issue.

Senator WATERS: No-one raised that—okay, so you are confident; you do not need to check the figures?

Ms Wood : Yes.

Senator WATERS: Excellent—I am pleased to hear it. Sticking with the consultation: I am also interested in what proportion of the respondents—if you can separate them out by survey and then by those roundtables, or consultations, as I think you have called them—were representative of employers of 100 and above and what proportion were representative of employees, including women's groups, union groups and any other advocates who are not employers?

Ms Wood : I can give you the figures for the survey—it was employers.

Senator WATERS: It was only employers?

Ms Wood : That was only employers.

Senator WATERS: I think you mentioned 523 earlier—

Ms Wood : Sorry—there may have been a couple who were not employers. The survey was open to anyone, but the questions were directed to employers who had reported, so we expect they were all—

Senator WATERS: Who were reporting, as opposed to had reported?

Ms Wood : No, they had reported at the point—

Senator WATERS: I thought you said the survey was done before the reporting period had—oh, after the period had finished but before the results had been revealed? Sorry!

Ms Wood : Yes. What I can give you is a breakdown of the submissions received in a moment—I think there were 48—and by actual type of organisation.

Senator WATERS: I think I have that, if that is what is on your website?

Ms Wood : It is in the consultation report. There were 42 submissions: 19 were reporting organisations—so, they were employers; 16 were employer representatives; one was an academic group—

Senator WATERS: Sorry—'employer' or 'employee'?

Ms Wood : 'Employer'. There was one employee representative organisation.

Senator WATERS: One?

Ms Wood : Yes. And one academic group—

CHAIR: And this is all on the website?

Ms Wood : This is all in the consultation report, yes. And five that were broadly categorised as diversity experts and women's sector representatives.

The fact that there were more submissions from employers did not necessarily influence the extent to which the issues that were raised in them were weighted; we did not say, 'There are 19 from employers, so they have 19 times the weight.' Given that the one employee representative submission was from the ACTU, obviously they represent employee organisations more broadly—

Senator WATERS: So you weighted the submissions according to—

Ms Wood : No—I was saying that we did not do that. I was saying that we were looking for the full range of views from all the stakeholders to feed into the options that we developed.

Senator WATERS: Sure—but you had a majority of employer groups, so presumably you weighted the employee submissions to try to get a more balanced perspective? Or are you saying, 'No, we didn't.'

Ms Wood : It was qualitative. It was not a mathematical exercise; it was qualitative input, and we looked at the issues that were raised.

Senator WATERS: So there were seven non-employer groups that had input into the consultation?

Ms Wood : Sorry, I will just clarify that. The ACTU was part of the Coalition for Working Women, who made a submission; and one union made a separate submission, which was the SDA.

Senator WATERS: Thank you. That does seem a little unbalanced. But thank you for taking those questions. I want to move not to the ABS data that was released today, which unfortunately showed an increase in the gender pay gap, which is now sadly at its highest in more than two decades. Does the agency or the department have a view, or does anyone have an understanding, about why that is getting worse?

Dr Moorehead : It is a difficult question. There are a range of reasons as to why the gender gap might get bigger or smaller at any time. I guess it is best to start with a national picture. At the national level, if we take all the employees in the country and divide them into males and females, there is a gap in the average hourly rate. The ABS preferred data comes from their EEH survey, and the most up to date one we have is May 2014. They also run the AWE survey, but the ABS has advised that the best survey to use to create the gender pay gap figures are from the EEH survey.

Senator WATERS: Sorry, what does that stand for?

Dr Moorehead : It stands for employee earnings and hours. They only run that survey every two years, because it is very expensive and very detailed. It takes a proper sample of employees from its sample of workplaces and it gets the actual pay figures. What that data tells us is that, as at May 2014, if you take all the employees in the country—and this figure of 'all employees' actually means 90 per cent of workers—the average hourly rate of pay is $35.30 as at May 2014. For men, the average hourly rate of pay is $37.60. For women, it is $32.50. That gives you a gender pay gap of 13.6 per cent. That is when we take everybody from all the different occupational groups around the country, and that is the ABS's preferred survey to use—from their statistics, from all the survey data they collect.

Senator WATERS: So where does the 18.8 figure come from?

Dr Moorehead : The 18.8 figure is when you look at what someone who is full-time earns over a week. The trouble with that is: men tend to work four hours a week on average more than women. So, when you are talking about full-time employees, on average, you are talking about a man who is actually working four more hours a week than a woman. So the gender pay gap gets bigger simply because there are more hours actually being worked, and thus paid for, by the male employee.

Senator WATERS: So are you saying that, when they break down the full-time adult average weekly ordinary time earnings, they are using a different measure, a different number of hours for women than they are for men? And they do not think to mention that in their table somewhere?

Dr Moorehead : They do mention it in the footnote and there is quite a lengthy—they have done a really good article that is available on the internet on how to use their gender data. It is excellent. It is worth reading. Going on from that, we look at that and then we ask: why is this the case? Because it is a gap. It is a 13.6 per cent gap on an hourly rate. That includes bonuses by the way; that is all the cash that the employee gets. So it does include bonuses and it actually also includes overtime. That is why we prefer to use it and why the ABS likes it. The absolute biggest reason is that, just like work that is done in the home, work done in the labour force is gendered. Men tend to go into different types of jobs than women, just like that happens within a household. So the fact is that jobs—

Chair interjecting—

Senator WATERS: That does actually have an influence. But I am ignoring that interjection. Please continue, Dr Moorehead.

Chair interjecting—

Dr Moorehead : The jobs are not randomly assigned in the economy to men or women; just like jobs within a household are not randomly assigned; they are discussed and worked over. And women tend to go into jobs, occupational groups and industries that we call the more 'feminised' industries. The fact that they are doing a different job means that they have different rates of pay, and that explains a lot of that gap.

Senator WATERS: I am interested in that that particular point. I have a particular example I want to put to you. When you say 'it explains a lot', do you have a sense of how much it explains? Are you able to quantify that?

Dr Moorehead : Various academics try and quantify it. They try and look at how much that explains. I think we feel comfortable saying that that is a major driver. In fact, if you look at the ABS website, that is what they conclude. They say that one of the biggest drivers for the pay gap is the compositional nature of the labour force.

Senator WATERS: Yes, it is a different type of work. I get the concept.

Dr Moorehead : Let's say a woman would starts off in a particular type of job. Then, once she is in that job, it does have a gendered nature to it. For example, nurses get into the job and then their career structure is based around nursing. They continue in that job, year after year, and it is quite gendered. It would be unlikely that a nurse would switch to a highly paid mining job in Western Australia during the mining boom. She is not the type of person who is going to get that high pay by switching over to working underground in a mine.

Senator WATERS: Thank you. I think I am following you there. I am just conscious of time. I do not mean to cut you off. I am interested particularly in an example in the graduate jobs and earnings study which was released in 2013—not by a government body but by a mob called Graduate Careers Australia. I understand it is a reasonably fulsome and comprehensive study. I discussed this with the ABS in the last estimates; although, unfortunately, due to reasons that escape all of us, I was not able to do for this week. In that study, one example which has stuck in my head was that there were still some examples—although, as you said, not the majority—of exactly the same job with men and women being paid differently, which of course is patently unacceptable. The example they gave was of dentistry graduates. I am interested in if that has been updated. And do we know of any other examples where the gap is so patently obvious in that it is the same job, acknowledging that that is not the majority of the problem but it is some part?

Dr Moorehead : That is without doubt a problem. The reasons it exists are many. For example, women dentists might decide to have a child. They might decide to take time out of the workforce. They might decide to return to work on a lower career trajectory

Senator WATERS: This one was at graduate starting salary, though; which was interesting because it factored out all of those other influences.

Dr Moorehead : It is definitely a problem. There is just no doubt that there is a problem there.

Senator WATERS: Do you have any more concrete examples or the extent of the problem?

Dr Moorehead : I think there are quite a few examples of the professions.

Ms Beattie : If you look at what we have uncovered through our pay equity campaign, the minimum requirement to be a pay equity ambassador was to acknowledge—and this was not something that we just created; it was what the CEOs themselves told us—that gender bias is real in workplaces, and, unless you analyse your payroll data, you will have instances of women being paid less than men doing the same or comparable work. These are 62 CEOs representing hundreds of thousands of employees, who acknowledge that this unconscious bias happens. So I do not think we will ever get to the perfect dataset, but what employers need to do is analyse their data and take action to ensure that the instances are not occurring.

Dr Moorehead : Luckily, people like dentists or the other graduates who were in that survey have very good career prospects. That is why we like to look at the national figure. It is like saying, with graduates, they have a lifetime of very strong earnings ahead of them.

Senator WATERS: I am conscious of the time. I just have one final question but I am not sure who is best to answer it. Recently at the G20 there was a government commitment—which we praised the government for at the time—to lifting participation of women in the workforce by 25 per cent by 2025. But my understanding is there is no policy instrument to give effect to that commitment. So I am asking: is anybody working on such a policy instrument and has anybody been asked to work on that issue? If so, what is the update so far?

Senator Abetz: Senator Cash is leading on that for the government.

Senator WATERS: Is anyone able to elaborate on that?

Dr Moorehead : There is a range of measures that the government has put in place to ensure that women's careers can progress et cetera. One of the big issues is to make sure there are jobs that women can do. It is a much bigger issue than people might give it credit for. We need to have jobs that are part time. We need to have jobs that are casual. We need to have short-hour jobs. We need to have the ability for women to come in and out of the workforce as their unpaid work responsibilities demand.

Senator WATERS: Flexible working hours?

Dr Moorehead : Yes.

Senator WATERS: I know the Greens have a bill for flexible working hours and have had for a few years in this place. Is there any work being done from the government perspective on flexible working hours?

Senator Abetz: Yes. We have legislation before the Senate called 'individual flexibility arrangements' to flesh them out a bit more.

Senator WATERS: Ones that do not erode other workplace rights would be ideal. But perhaps this is not the time to go into that.

Senator Abetz: All I would invite you to do is not listen to the rhetoric but have a look at the actual legislation and you will see that that assertion is without foundation.

Senator WATERS: Thank you. I will have a look; although, I suspect that I will not like what I see. Thank you. I will have a look. Thank you.

CHAIR: Thank you very much, everyone. Have a good night.

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