BBC gender salary gap highlights need for employers to re-evaluate pay

Tuesday, August 1, 2017

Recently the BBC revealed the salaries of its highest paid stars, igniting widespread debate around the gender pay gap in public organisations. The salary details, which the BBC was compelled to reveal under its new Royal Charter, revealed that only five of the top twenty earners at the BBC were women, and only one of the top ten.

This has led to calls for similar disclosures to be made in New Zealand, notably by Television New Zealand, New Zealand’s state broadcaster and equivalent entity to the BBC.

While no such disclosure has been made by TVNZ, the events of the last week highlight the potential public pressure employers could face if the Employment (Pay Equity and Equal Pay) Bill (the Bill) introduced to Parliament on 26 July 2017, is passed into law.

Under the proposed changes, employees would be able to make a ‘pay equity claim’ where they consider that there is a disparity in pay for work that calls for the same, or substantially the same skills, degrees of skill, effort, experience and responsibility from male and female employees and that work is performed in the same or substantially the same conditions.

The Bill obliges an employer to investigate any pay equity claim within 90 days, and, if the claim is found to have merit, requires the employer to commence a ‘pay equity bargaining process’ with the employee and potentially with any other employee in the same position. The Bill also provides that parties that cannot resolve a pay equity claim may apply to the Employment Relations Authority for a determination as to whether the claim has merit.

Employers should also be wary that the Bill imposes a penalty of up to $20,000 for a company that does not comply with the employer’s duties not to discriminate on the basis of gender between employees who perform the same, or substantially the same work, and to deal with an employee in good faith during any pay equity bargaining.

The BBC example highlights how negative publicity in relation to any pay disparity could cause significant damage to a company’s reputation. On this basis, employers may wish to be proactive in assessing any possible risks of pay equity claims, before any potentially damaging claims are raised.

Duncan Cotterill will continue to follow developments closely, and will update when more details become available. For more information on any of the matters discussed above, please contact a member of our specialist employment team.

 

Disclaimer: the content of this article is general in nature and not intended as a substitute for specific professional advice on any matter and should not be relied upon for that purpose.

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