IOLA MATTHEWS. Bridging the gender pay gap, one case at a time (Sydney Morning Herald 26 April 2019)Apr 30, 2019
The path to more equal pay for women is one issue that could be significantly affected by the result of the forthcoming federal election.
Labor has unveiled a national strategy to close the gender pay gap, as well as policies to lift the wages of low-paid workers.
The Coalition does not have a plan to address the gender pay gap. Instead, Prime Minister Scott Morrison says the gap has fallen from 17.2 per cent under Labor to 14.5 per cent under the Coalition.
Gender pay gap by the numbers
Dr Elizabeth Hill of the University of Sydney explains what are the causes for the gender pay gap.
This obscures the fact that the gender pay gap has fluctuated between 14 and 19 per cent for the past two decades, and the biggest gap during that period was 18.5 per cent under prime minister Tony Abbott.
Labor has promised to strengthen the Fair Work Commission’s ability to order pay increases for workers in undervalued female-dominated industries such as early childhood, aged care and disability services. Labor has also pledged to set up an expert Pay Equity Panel of the commission, supported by a Pay Equity Unit.
The implementation of these pledges would have a dramatic effect on two equal pay cases currently stalled in the commission. One is for childcare workers (now called early childhood educators) and the other is for early childhood (preschool) teachers.
I reflect on the long and ongoing battle for equal pay in my new book Winning for Women. We’ve come a long way since the famous “Harvester” judgement of 1907, when Chief Justice H.B. Higgins ruled that the minimum wage should be enough to support a man, his wife and three children. He later set women’s wages at 54 per cent of the male rate.
During World War II, many women took over the jobs of men who were away, and women’s pay moved up to 75 per cent of the male rate. After the war, women were mostly forced out of those jobs.
In 1969, with Bob Hawke as advocate, the ACTU won “equal pay for equal work”. In 1972, with Ralph Willis as advocate, the ACTU introduced a wider case for equal pay, but the McMahon government opposed it.
My involvement in the fight for equal pay began that year, as one of the founders of the Women’s Electoral Lobby. We pressed for the reopening of the 1972 equal pay case, and as soon as Gough Whitlam was elected prime minister, he did so. The ACTU then won “equal pay for work of equal value” – meaning men and women on the same level in an award could get the same pay, even if they were doing different work. The following year, the minimum wage was extended to women.
In 1984 I joined the ACTU as co-ordinator of a new women’s employment program, which included strategies for equal pay. In 1986 we won an equal pay case for nurses, run by my colleague Jenny Acton. Combined with a massive strike by Victorian nurses, led by Irene Bolger of the Royal Australian Nursing Federation, the case secured large pay increases and was followed by “professional rates” cases, which resulted in a further jump in pay.
In another major case, run by Anna Booth of the Clothing Trades Union, the union and the ACTU won the right for “outworkers”, working in their own homes for about $2 an hour, to get the same pay and conditions as their counterparts in a factory.
In the late 1980s, equal pay got a large boost with “award restructuring”. These were effectively equal pay cases, comparing the skills, training and responsibilities of female workers with the key metal workers’ award.
In 1989, my colleague Jenny Doran began an equal pay case for childcare workers, with Del Cseti of the Miscellaneous Workers Union (FMWU). At the time, childcare workers were on extremely low pay, and the award had only two levels: an untrained worker and a trained worker.
Doran argued that childcare wages were low because it was “women’s work”, and because the industry was largely dependent on government funding. This led to a 12-month inquiry before Commissioner Robert Laing.
Laing’s report said the award rates did not recognise the true value of the skills, training and responsibility in the industry. It was referred to a full bench of the commission to determine future wage rates and a new classification structure.
I took over the case in 1990, with Chris Christodoulou of the FMWU. Our job was to argue the case before a full bench, and I felt very nervous, especially as my colleagues said Justice John Ludeke (presiding) could be irascible.
I argued our proposal for a new structure, with five levels for childcare workers and three levels for directors. Justice Ludeke fired questions at us every few minutes.
We were still there after dinnertime. I felt weak from hunger, and asked if I could slip out and buy something. The answer was no. The building was locked and if we went out, we would not get back in. I developed a pounding headache.
While we were there, the advocate for the Hawke government presented us with a typewritten statement and disappeared. It said the cost impact of the case would be too great, and the government would not underwrite it. This was a bombshell.
I ran around until I found an office with a phone and rang my boss, ACTU Secretary Bill Kelty. I
tracked him down to the Cabinet Room, where he was meeting with Hawke and treasurer Paul Keating.
The next morning, we presented the new definitions and wage rates and after lunch, the government’s advocate read out a new statement. He said the Commonwealth supported increased rates for childcare workers, better career paths and training, and that it would be extending fee relief to the private childcare sector, which would assist parents with fees.
This was the breakthrough we needed. At the end of the case, we won the new career path and significant pay increases. In its decision, the commission said “the members of this industry’s workforce, from whom the community expects so much, have been disadvantaged”.
In 1993 the Keating government passed industrial relations legislation that included “equal remuneration for men and women for work of equal value”. That was a big advance, because “remuneration” meant not just the award rate, but also payments above the award.
Subsequent equal pay cases showed, however, that the Fair Work Commission had difficulties in interpreting that section of the legislation. Of 21 applications made since 1994, only one has resulted in an equal remuneration order.
Known as the SACS (Social and Community Services) case, it took three years, and in 2012 won large wage increases for non-government community service employees such as social workers and welfare workers. The increases were to be phased in over eight years. The case was co-ordinated by Sally McManus, then with the Australian Services Union.
A crucial element of the case was the support of the Gillard Labor government, which pledged nearly $3 billion towards the pay increase. The union lobbied hard, and the government agreed to contribute because the federal and state governments fund the non-government organisations that employ community service workers.
In 2013, an equal pay case for early childhood educators was begun by the union United Voice with the Australian Education Union. The bulk of these workers earn about $42,000 a year – half the national average wage. The unions argue that the skills and responsibilities have increased because of government regulations, and the work is still undervalued because it is “women’s work”.
The case was complex, and in 2016 the unions decided to compare early childhood educators with similar levels in the male-dominated manufacturing award. While the award rates were similar, the remuneration in manufacturing industries was higher, based on over-award payments and enterprise agreements.
In 2018 a full bench dismissed the case for equal remuneration, but suggested the unions could run a conventional work value case. The case had by then run for five years, and cost the unions more than $1 million. Sally McManus, by now the ACTU secretary, said the decision showed the current laws were incapable of addressing the gender pay gap.
Another equal pay case, run by the Independent Education Union, began in July last year. It’s for degree-qualified preschool teachers, with the aim of bringing them into line with primary school teachers. The case will compare pay rates for early childhood teachers with male primary teachers and male engineers. It’s expected to resume later this year.
The gender pay gap for full-time adult workers is currently 14 per cent, the ABS average across the whole workforce. The gap is much wider in higher-paid and senior jobs, and women are less likely to get over-award pay, bonuses and performance pay.
The gender pay gap measured by the Workplace Gender Equality Agency (WGEA) is 21 per cent, but that is for large companies, and does not include government employment or the not-for-profit sector.
Labor has said it will force big companies to publish their gender pay gaps for the first time, and will require all Australian government departments and agencies to conduct a gender pay audit.
Another way of reducing the gender pay gap is to further encourage young women into non-traditional jobs such as STEM (Science, Technology, Engineering and Maths). We also need greater availability of flexible work hours at all levels, for men as well as women.
The gender pay gap measures full-time work, but the gap in total earnings is 32 per cent. That’s because women are more likely to work part-time and do less overtime because of their family responsibilities.
The gender gap in superannuation is even bigger; women currently retire with 42 per cent less than men. That’s because women earn less, are more likely to work part-time and have periods out of the workforce.
Labor has pledged to introduce superannuation payments for the first time for employees on paid parental leave or partner leave. It has also said it will scrap the $450-a-month minimum income test for the payment of superannuation.
The struggle for equal pay has a long history. There are multiple causes for the gender pay gap, and a range of solutions is required. It cannot be fixed by legislation alone, but Labor’s proposed changes will make it easier to run equal pay cases, and for the Fair Work Commission to undertake pay equity reviews of low-paid industries dominated by women.
The question of “who pays” will have to be worked out on a case-by-case basis, and any increases phased in over time. But in the past it has been Labor governments that have been prepared to contribute.
Winning for Women: A Personal Story, by Iola Mathews (Monash University Publishing, $29.95) will be launched by ACTU Secretary Sally McManus on May 2.