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Pay gaps and pay equity: What an inquiry needs to consider

On the eve of the alert level 4 lockdown, the Cabinet decided to set aside funding for a new pay equity agreement with nurses. Any negotiated agreement will follow on the heels of agreements which have already been reached with care workers and teacher aides.

Pay equityAdditionally, pay equity issues are now being addressed in education for Te Reo Maori teachers. To resolve these claims the parties must compare pay for these occupations to comparable male dominated occupations.

Pay issues for ethnic minorities are now also coming into the spotlight. Statistics have shown that there is a 23 per cent wage gap in New Zealand between Pacific workers and Europeans.

The Ministry of Business, Innovation and Employment released its own report in 2018 which found that Pacific workers experienced reduced access to secure and stable employment. It said they were found in low-paid occupations and that discrimination took place in workplace practices, recruitment, pay, retention and progression.

To address this, the Equal Employment Opportunities Commissioner, Saunoamaali’i Dr Karanina Sumeo, announced the establishment of an inquiry to investigate this pay disparity, its causes and how it can be reduced or eliminated.

The Human Rights Act says it is unlawful to discriminate against a person on account of their ethnicity. The statistics given by the Human Rights Commission suggest that Pacific people are disadvantaged systemically in New Zealand. While discrimination is unlawful the framework for enforcing these rights is not well-equipped to address systemic inequality.

The common law judicial system which enforces human rights means that for the most part, only individuals and unions can make claims against individual employers. The onus rests on an aggrieved person to prove on the balance of probabilities that they have been discriminated against.

When each case is looked at in isolation, it can be very difficult to prove that an employer has discriminated against an employee. If there is discrimination, it will not normally be public. Some say it takes place behind closed doors by closed minds.

The Human Rights Commission carried out a series of meetings or hui over two years to get feedback from Pacific people. This certainly suggested discrimination. It is only when a broader study or inquiry takes place that the overall picture emerges.

Sumeo highlighted some of the factors that might be relevant to the disparities the inquiry will look into. She mentioned the care sector. She said Pacific people are good at providing a service, however, “what happens is that those organisations then leave our people at the service delivery level and don't prioritise moving them up the ladders”.

She added that some Pacific workers do not speak up because “if you're only here on a visa, people don't feel safe to open their mouths if they feel like they're being treated unfairly”.

Another area she felt needed attention was rewarding cultural competence.

She said “pay scales do not factor in pay for cultural competence”. She said if you did not have cultural competence in your workforce, you would not understand the people you were providing a service for and would not reach the desired outcomes in some sectors.

The commissioner identified this as being particularly relevant in health and education. So, the argument is that if employers need insight into cultural matters, for example in the health and education sectors, those who provide it ought to be rewarded within their pay scales, but they are not.

Sumeo also highlighted the lack of relevant statistical information in the private sector. She said there was little reliable data on the issues that concerned her as opposed to the public sector where there was a lot more.

The inquiry will focus particularly on the pay gap between European and Pacific people. What are the causes of the pay gap? The Equal Employment Opportunities Commission inquiry will examine perceptions held towards Pacific people in employment.

It will look at what the experience of both Pacific workers and Pacific self-employed contractors with pay negotiations, and with training, promotion and progression.

The inquiry will make recommendations on its findings. They may extend beyond targeted social campaigns or guidelines for employers and could include recommending changes to legislation, regulations and funding arrangements.

These are very important issues. It is critical to start the inquiry with an open mind and have recommendations which are evidence-based.

 

She added that some Pacific workers do not speak up because “if you're only here on a visa, people don't feel safe to open their mouths if they feel like they're being treated unfairly”.

Another area she felt needed attention was rewarding cultural competence.

She said “pay scales do not factor in pay for cultural competence”. She said if you did not have cultural competence in your workforce, you would not understand the people you were providing a service for and would not reach the desired outcomes in some sectors.