Pay Equity

On 19 September 2018, the Equal Pay Amendment Bill was introduced to Parliament. This Bill introduces a simple and accessible process to address systemic sex-based pay discrimination across female-dominated industries.

It will allow workers to make a pay equity claim within New Zealand’s existing bargaining framework. By making court action a last resort, the proposed approach will lower the bar for workers initiating a pay equity claim, and utilise a collaborative process more familiar to unions and businesses.

Under the Bill, employers, workers and unions will negotiate in good faith, with access to mediation and resolution services available if they are unable to agree.

Background to the Bill’s development

Joint Working Group on Pay Equity Principles

In 2016, the Joint Working Group on Pay Equity Principles provided recommendations to the government to guide the implementation of pay equity. The JWG noted that the current framework in the Equal Pay Act 1972 relies on the courts to determine principles for assessing pay equity issues and setting pay rates. The principles developed by the JWG aimed to deal with the complexity of the court-based approach, by creating a new pay equity claims process based on the bargaining framework in the Employment Relations Act 2000, for employees and employers to assess a pay equity claim and agree on a settlement.

In July 2017, the previous government introduced the Employment (Pay Equity and Equal Pay) Bill which gave effect to the previous Government’s response to the Joint Working Group’s recommendations. Following the formation of a new coalition government, the Bill was withdrawn from Parliament in November 2017.

Former Employment (Pay Equity and Equal Pay) Bill

In April 2017 MBIE sought written submissions on a public consultation document of the former Employment (Pay Equity and Equal Pay) Bill. This Bill has since been withdrawn from Parliament.

Submissions closed on 11 May 2017. The submissions received represent views from individuals, union members, unions or worker associations, advocacy groups, employers, and law firms.

The key Cabinet papers relating to the former Bill are accessible below.

Reconvened Working Group on Pay Equity Principles

In January 2018 Ministers reconvened the Joint Working Group to provide further recommendations that address key stakeholder concerns relating to the former Bill. The recommendations were provided to Ministers in February 2018, and were used to develop pay equity legislation.