Pay equity

Pay Gap or Equal Pay?

While often used interchangeably, the pay gap and pay equity are distinct concepts.

According to WGEA, the gender pay gap is the difference between the average earnings of women and men in the workforce.1 The gender pay gap is an indicator of women’s overall position in the workforce in comparison to men and is influenced by a number of factors including discrimination and bias, industry and job characteristics, shares of unpaid caring and domestic work, the under-representation in senior roles, and lack of workplace flexibility.

Equal pay, or pay equity, is about equal pay for work of equal or comparable value. Pay equity is one of many factors that contribute to the pay gap. Even though equal remuneration is required by the Fair Work Act of 2009, unequal pay continues to be an issue, and organisations may be paying employees unequally without even realising. This is why it is important that organisations undertake regular pay equity analyses.  

 

Does the pay gap only affect women?

In Australia, the vast majority of research on pay gaps focusses on gender.

We do know, however, that pay gaps also exist for Aboriginal and Torres Strait Islander people2, people with disability3, people who identify as LGBTIQ+4, and people from culturally and/or racially marginalised backgrounds5 (particularly with a migrant status6).

DCA members can login for state of play data, definitions of other key terms and to learn more about the leading practice on how to address pay equity.

  • 1. WGEA, ‘The gender pay gap
  • 2. Australian Government, Closing the Gap, Report 2020. 2020. [Online]
  • 3. E. Emerson, G. Llewellyn, R. Stancliffe, H. Badland, A. Kavanagh, and G. Disney, A fair go? Measuring Australia’s progress in reducing disadvantage for adults with disabilities (2001-2016). Centre of Research Excellence in Disability and Health, 2018. [Online]; Australian Institute of Health and Welfare, ‘People with disability in Australia (AIHW)’, AIHW, Oct. 2020.
  • 4. J. J. Sabia and M. Wooden, Sexual Identity, Earnings, and Labour Market Dynamics: New Evidence from Longitudinal Data in Australia, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne, Mar. 2015. [Online]; A. La Nauze, ‘Sexual orientation–based wage gaps in Australia: The potential role of discrimination and personality’, The Economic and Labour Relations Review, vol. 26, no. 1, pp. 60–81, Mar. 2015
  • 5. R. Whitson, ‘Culturally diverse women paid less, stuck in middle management longer and more likely to be harassed’, ABC News, Mar. 11, 2022. [Online]
  • 6. L. Berg and B. Farbenblum, Wage theft in Australia: Findings of the National Temporary Migrant Work Study, Migrant Worker Justice Initiative, Nov. 2017. [Online]

The rest of this content is restricted to DCA members.