Workplace Gender Equality Amendment (Closing the Gender Pay Gap) Act 2023

The Workplace Gender Equality Amendment (Closing the Gender Pay Gap) Act 2023 (Closing the Gender Pay Gap Act) received Royal Assent on 11 April 2023, as a further step to implement a recommendation of the 2021 review of the Workplace Gender Equality Act 2012 (Cth) (WGE Act). The amendment follows the recent legislative changes under the Fair Work Legislation Amendment (Secure Jobs, Better Pay) Act 2022 (Cth) prohibiting pay secrecy and strengthening measures to achieve equal remuneration in an effort to overcome wage disparities. Our previous Legal Alerts are accessible here: prohibiting pay secrecy and equal remuneration.

The changes in the WGE Act insert new provisions to improve transparency and strengthen the focus on pay gaps and gender equality in the workplace. Minister for Women, Senator the Honourable Katy Gallagher, says that this is a critical step towards achieving women’s economic equality.

The WGE Act requires ‘relevant employers’ which includes private sector employers and Commonwealth public sector organisations with 100 employees or more (full-time, part-time, casual & temporary (fixed-term) employees are included in the headcount) to submit an annual report to the Workplace Gender Equality Agency (WGEA) on gender equality data. The changes now impose new obligations on relevant employers to report data and information and to legislatively allow WGEA to publicly publish the information. We have outlined the key changes below.

Key changes

Information collected & publishing

• Presently, the WGEA facilitates the reporting by relevant employers of workforce data and information against gender equality indicators.
• A new section 15A(1) in the WGE Act will require WGEA to publish aggregate information for each relevant employer for each reporting period showing the employer’s gender pay gap and progress in achieving gender equality in relation to remuneration for the employer’s workforce.
• Currently, WGEA uses the data to publish gender pay gap information at a national industry and occupational level. The legislative changes will allow WGEA to publish gender gap information at an employer level.
• The changes will also require (rather than accept voluntary reporting of) relevant employers to report workforce data on employee age (year of birth), primary workplace location and remuneration for their Chief Executive Officer (CEO) and managers (for example casual retail managers, hotel Managers and other managers in different industries listed in the Australian and New Zealand Standard Classification of Occupations Standard).
• A new section 15A(4) will prohibit WGEA from publishing information that discloses, either directly or indirectly, personal information or other information about remuneration paid to a specific individual.  Individual CEO pay information will not identify the individual and will only be used to accurately calculate gender pay gap information.
• The WGEA expects that the inclusion of CEO remuneration will have a significant impact on employer mean gender pay gaps.

 Mandatory sharing of reports to governing body

• Currently, the WGEA confidentially provides reports such as the Executive Summary and Industry Benchmark Report from the reporting process to each employer’s CEO and reporting contact, at the end of the reporting period.
• The changes will require CEOs of relevant employers to provide copies of these reports to all members of their Board or Governing Body and to report the date on which these reports were shared. Failure to do so, without reasonable excuse, will be treated as non-compliance with the legislation.

 Minimum standards

• Under section 19(1) of the WGE Act, the Minister for Employment sets the ‘minimum standards’ in relation to gender equality indicators. These standards are in Workplace Gender Equality (Gender Equality Standards) Instrument 2023.
• The changes repealed the ‘minimum standards’ and rename these ‘gender equality standards’ and change all references in the WGE Act.
• Currently, relevant employers with over 500 employees must have policies or strategies in place to support one or more of the following four (4) indicators as below:
  1. Gender composition of the workforce;
  2. Equal remuneration between women and men;
  3. Flexible working arrangements; and
  4. Sex-based harassment and discrimination.
• The changes will require relevant employers with over 500 employees to have policies or strategies that cover additional indicators, being all 6 gender equality indicators   set out below:
  1. Gender composition of the workforce;
  2. Gender composition of governing bodies of relevant employer;
  3. Equal remuneration between women and men;
  4. Availability and utility of employment terms, conditions and practices relating to flexible working arrangements for employees and to working arrangements supporting employees with family or caring responsibilities;
  5. Consultation with employees on issues concerning gender equality in the workplace; and
  6. Sexual harassment, harassment on the ground of sex or discrimination.

Reporting on sex-based harassment, harassment on the grounds of sex or discrimination

• Relevant employers are already required to report information regarding sex-based harassment and discrimination. The changes will expand the reporting obligations of employers to report to WGEA the following information with respect to ‘sexual harassment or harassment on the ground of sex or discrimination:’
  1. The existence of, and information about, a policy or strategy to prevent and respond to sexual harassment, harassment on the ground of sex or discrimination, including information in relation to:
     • accountability and responsibility frameworks; and
     • a process to disclose and respond to any sexual harassment, harassment on the ground of sex or discrimination; and
     • training on respectful workplace conduct and sexual harassment prevention and response, including the frequency of training; and
     • frameworks outlining the communication expectations from governing bodies and managers with respect to these matters;
  2. The existence of, and information about, a risk assessment and management policy or practice to prevent and respond to sexual harassment, harassment on the ground of sex or discrimination, including the following information:
     • risk, prevention, controls and response plans;
     • analysis of sexual harassment, harassment on the ground of sex or discrimination risks, incidents and actions;
     • risk reporting to governing bodies, Chief Executive Officer or equivalent, Agency Head or equivalent and key management personnel;
  3. Information on any information or data collected by the relevant employer in relation to the prevalence of sexual harassment, harassment on the ground of sex or discrimination in the relevant employer’s workplace, including information or data on the outcomes of any reported incidents; and
  4. Information on any measures in place to support employees who have experienced, or are at risk of experiencing, sexual harassment, harassment on the ground of sex or discrimination.

How does this impact employers?

The WGEA has developed a road map as to when the changes will apply to relevant employers. The table below provides a summary noting this may be subject to change:

There are anticipated further legislative changes which will include:

• collection of information about employees who identify as non-binary
• collection of diversity information about employees
• setting and achieving gender equality targets
• additional changes to support the recommendations outlined in the Respect@Work: National Inquiry into Sexual Harassment in Australian Workplaces

Relevant employers should consider the upcoming changes and have an action plan in place regarding the development and implementation of strategies and policies with regards to all the 6 gender equality standards. Relevant employers should also consider reviewing how they collect the data provided to WGEA and respond to mandatory reporting information if these are applicable to the organisation.

EMA Legal can assist employers in the review of existing relevant policies as well as the development of new strategies and policies with regards to gender pay gap in line with the legislative changes.

EMA LEGAL is available to assist WITH ADVICE IN EMPLOYMENT LAW MATTERS. 

For further information, please do not hesitate to contact:

KAYE SMITH

Principal Partner

e: kaye.smith@emalegal.com.au
w: www.emalegal.com.au