Why New Zealand needs Pay Transparency

Why New Zealand needs Pay Transparency

July 19, 2019

Are all New Zealanders in the same role or job, getting paid the same? 

Pay equity or “equal pay for work of equal value” is a fundamental right under international human rights law.

New Zealand is a signatory to several Treaties that guarantee fair pay and equality in the workplace, so our Government has a legal duty to ensure these rights are upheld. 

There needs to be fairness at all stages of work – applying for a job, equal pay, fair working conditions, and equality of opportunity for training and promotion. 

However, there are still deeply held societal attitudes and beliefs about the types of work that are appropriate for men and women, and the relative importance of occupations where men or women dominate. This has led to female-dominated occupations such as caring, clerical work and cleaning to be much lower paid than other jobs. 

While equal pay for women is guaranteed under New Zealand’s Equal Pay Act 1972, this has not stopped women, especially ethnic minority groups being paid less than the dominant groups in society. Are all jobs evaluated fairly concerning skills, experience, effort, and responsibility?

The gender pay gap is a high-level indicator of the difference in pay between men and women and can be used as a way to measure progress. Currently, we have a 9.4% gender pay gap overall between women and men even though it has been 45 years after the Equal Pay Act was introduced. This gap is much wider for Māori and Pacific women. To reduce the gap would require businesses to critically look at and address the factors behind the gap.

When you look at wages over time, there is a clear hierarchy of who earns the most wages in New Zealand and this has remained unchanged over the last 7 years. European New Zealanders earn the highest hourly wage, followed by Asian, Māori and at the bottom, Pacific people. These positions remain unchanged even as wages rise.  

                   bottom, Pacific people. These positions remain unchanged even as wages rise.


Even if we break the data down into gender and ethnicity, this is a hierarchy that remains almost unchanged over time. European men always earn the most money, and Pacific women the least. What is most concerning about the public sector information is that the pay gap for Pacific people has widened from 19.8% in 2008 to 21.6% in 2018.  

The Wealth Gap

It is important to understand how the Gender and Ethnic pay gaps affect people in the real world. A tangible measure is home ownership – long thought of as the “Kiwi dream”. 

The 2013 census shows Pacific people and Māori have the lowest home ownership rates in New Zealand. 

  • At the time, 56.8 percent of Pākehā owned their own house, followed by  
  • 34.8 percent home ownership for the Asian population. 
  • 28.2 percent of Māori owned a house, and just  
  • 18.5 percent of Pacific people. 

According to Statistics New Zealand, net worth by ethnic group in 2016 was reflected as follows: 

  • European $114,000 
  • Asian $32,000 
  • Maori $23,000 
  • Pacific People $12,000 

Ending Pay Secrecy 

New Zealand does not currently have a legal requirement for businesses to report on their gender or ethnic pay gaps. 

Employees do not have the right to know what other people in the same job or occupation are earning. This secrecy has meant that women, particularly women from ethnic minority groups have not realised that they are often being paid far less than men doing the same or similar roles.  

We are far behind other countries like Australia, the UK, Germany, and parts of Canada who have passed laws requiring organisations report on their gender pay gap. 

The Human Rights Commission has started a campaign to end pay secrecy in New Zealand. 

We think that to start with, companies with 100 or more employees should report annually on their gender pay gap, their bonus gap and the gender of people at each level of their organisation. This information should be publicly available. This is called pay transparency. 

An independent agency needs to be set up to monitor compliance and to provide advice and support to women wishing to make an equal pay claim. 

Tackling this problem is going to take time, effort and money. We cannot kid ourselves that structural inequality is simply easy to fix. It will mean some uncomfortable soul searching for our leaders at the top and in the middle management of the public sector, as well as the human resource teams responsible for recruitment. 

We need to look at who we are recruiting, promoting, giving training and leadership opportunities too. Closing the gender and ethnic pay gaps in the public service is a human rights issue. We all have the chance to make a positive difference to the lives and families of thousands of public sector employees by focusing on this important issue.