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Step forward for pay equity

STEP FORWARD FOR PAY EQUITY

The significance of the decision made by the Court of Appeal to uphold Kristine Bartlett and the Service and Food Workers Union equal pay claim is hugely significant and has been welcomed by women’s groups and trade unions who have fought for gender equality in the labour market for 60 years and more.

The decision means in essence that the 1972 Equal Pay Act was always and continues to be an Act covering equal pay for work of equal value (often now called pay equity). It is NOT a defense against equal pay claims to find a few men in a female dominated occupation who are paid as little as the (undervalued!) women.

Equal pay for work of equal value requires that work assessed as needing similar overall levels of skill, responsibility, effort and working conditions should be paid equally. Worldwide there is ample evidence that female dominated work has historically been undervalued by decision makers, the market, and in bargaining situations. Gender neutral job evaluation systems have been devised to remedy this undervaluation and negate over-simple market determination arguments.

Changes in employment law towards contracts rather than broader awards and agreements made progress on pay equity even harder in the 1990s. Labour-led governments from 1999 made only minor changes to these structures, but did progress pay equity in the public sector, health and education, through the (then) Department of Labour’s Pay and Employment Equity Unit (PEEU). Abolished by the 2008 National-led government, its research and evaluation tools remain helpful in the current case and future developments. Difficulties involved in selecting comparators and evaluating the work was raised as a major problem by the employer and the Aged Care Association (NZACA).

The Court of Appeal placed less weight on the Bill of Rights and our international obligations than the Employment Court. Nevertheless these elements strengthen the case for clearer and stronger interpretation of the Equal Pay Act. And recent comments by international institutions on New Zealand government reports on progress have criticised our lack of action. For example in July 2012 New Zealand was called on to effectively enforce the principle of equal pay for work of equal value, through establishing specific measures and indicators, identifying time frames to redress pay inequality in different sectors and reviewing the accountabilities of public service chief executives for pay policies.

The case taken by SFWU and Kristine Bartlett was against her employer, Terranova Homes and Care Ltd. Kristine argued that her hourly wage of $14.46 was so low because she works in a female dominated industry, and to obtain a true equal pay rate for caregivers in the aged care sector would mean comparing the work with a job in a male-dominated sector with similar skills, effort and responsibilities.

Terranova disagreed – although they agreed wage rates were low they didn’t believe that was due to the industry being female dominated. They said if both male and female caregivers were being paid the same, that was equal pay.

The Court found in Kristine’s favour. The employers’ organisation NZACA has regularly accepted that their care workers deserve a pay increase, and in particular to earn as much as similar work in the public sector, where DHB carers’ pay is around $2 to $3 per hour more. However, ACA claims there is no fat in the system, even where reported profits are high, and any increase must be matched by more government funding.

Employers and government each pass responsibility onto the other, while the carers suffer with pay below their value and little above minimum wages, despite the considerable skills needed.

On the cost/affordability concerns about a pay increase, Employment Chief Judge Colgan pointed out that similar arguments were made against the abolition of slavery. Moreover, simply leveling up the private sector pay levels to caring work in the public sector is important, but insufficient. It deals only with the very direct inequity of lack of equal pay for almost identical work, but does not tackle the issue of the overall undervaluation of caring work, which requires evaluation of the value of the work against comparators in non female-dominated jobs.

How the case will proceed from here is by no means clear. This issue will not and should not go away until equity is achieved.

 

By Prue Hyman, formerly Associate Professor of Economics and Gender and Women’s Studies at Victoria University, is assisting the Service and Food Workers Union with the equal pay case.

 

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