If you need further support with the gender pay gap toolkit, read through the FAQs below or get in touch with us at GenderPayGap.Toolkit@women.govt.nz.
What is the gender pay gap?
The gender pay gap is the difference in earnings between men and women in the workforce. It can be expressed as a percentage or a dollar figure, and be measured at a job, organisation, industry, and national level.
Why is it important to measure the gender pay gap?
Reporting your gender pay gap figure and context statement is an important step towards addressing gender inequality in your organisation and making your pay practices fairer and more transparent.
What are the consequences in reporting a significant gender pay gap?
There are no negative outcomes associated with reporting your organisation’s gender pay gap. What matters is the actions you take to address your gender pay gap.
Your gender pay gap figure has to be put into context and there are resources in the toolkit to help you do that.
Understanding and explaining that context is a critical part of your organisation’s narrative. Without it you are unable to start the conversations needed to drive change to become a more equitable workplace.
Are equal pay and the gender pay gap the same?
While both equal pay and the gender pay gap refer to inequities of pay, there are some differences.
Equal pay is the same pay for the same work regardless of gender. Equal pay is covered in the Equal Pay Act, which was amended in 2020.
The gender pay gap looks at earnings over an entire organisation. It does not only apply to people in the same position.
How was the methodology for the gender pay gap toolkit determined?
The design of the methodology has been led by sector leaders, businesses, and organisations to ensure it met their needs.
As a starting point, we looked at what guidance was already available in New Zealand and internationally and what points of the guidance we wanted to test.
What we found was that, particularly with the New Zealand guidance, there was an amount of flexibility built in that meant results weren’t always comparable. This flexibility was often around the types of pay and who is included in the calculation.
Through engagement and testing with a wide range of organisations we have agreed on a final set of components to measure the gender pay gap, while still making it easy for organisations to calculate.
What do you mean by a ‘median’ gender pay gap?
A median is the middle of a set of numbers.
The median pay gap is calculated by finding the midpoint in all employees’ pay. Half of the employees’ earnings will be above the midpoint and half will be below the midpoint. Often, a median pay gap will be lower than its corresponding mean pay gap.
What do you mean by an 'average’ or ‘mean’ gender pay gap?
The average or mean pay gap is calculated by adding all employees’ rates of pay together and dividing by the total number of employees.
The mean takes into account all of the lowest and highest rates of pay, and therefore reflects the impact of the higher proportion of women working in lower paid roles, and the higher proportion of men in higher paid roles.
Which is more accurate: mean or median?
From a purely statistical standpoint, the median is considered to be the more accurate measure because it is not skewed by very low hourly pay or very high hourly pay.
On the other hand, we know that the very high paid people tend to be men, and the very low paid people tend to be women, and the mean paints an important picture of the pay gap because it reflects this issue.
It is good practice to use both the mean and the median when analysing or reporting on the gender pay gap.
How does this calculation compare to the national gender pay gap calculation?
Both calculations use the median pay, however Stats NZ calculates New Zealand’s gender pay gap as the difference between the median hourly earnings of women and men in full- and part-time work.
It does not include any components of pay that are paid on top of the hourly rate, such as bonuses and overtime.
What does the public sector use to calculate pay gaps and is it different?
The public sector uses the components of the Stats NZ calculation but requires agencies to report the mean. Agencies are required to calculate both the mean and median. The public sector excludes the Chief Executive.
More information on public sector pay gaps can be found on the Public Service Commission's website.
Is the calculation the same as other countries?
There are some differences between other countries. The common differences are in types of pay and who is included in the calculation.
For instance, the UK includes contractors if they are self-employed (not through an agency), and until this year, Australia has excluded the Chief Executive.
My gender pay gap is in favour of women/gender diverse (a negative percentage), does this mean I don’t need to do anything?
You should still take action to address your pay gap if it is in favour of women/gender diverse to ensure your workplace is fair and equal for all.
Is my organisation too small to measure its gender pay gap?
Any organisation can measure its gender pay gap, but we recommend only reporting wider than your HR and leadership teams if you have more than 10 employees in each gender cohort.
My gender pay gap has increased since implementing my action plan, why?
Some positive actions taken to close your gender pay gap will result in an initial increase in your gender pay gap. This is not a bad thing.
For instance, if you have a focus on increasing the number of women in your workforce, it is likely that they would start in lower paying roles or as new graduates. This will increase your gender pay gap initially.
Putting clear career progression pathways around new entrants will close your gender pay gap in the longer term as more and more women progress higher within the organisation.
Will you include ethnicity in the gender pay gap toolkit?
The intention is that this toolkit will evolve over time in line with the needs of New Zealand organisations. Engagement with businesses, employers and sector leaders will continue as more organisations start to invest in understanding and reporting on their gender pay gap.