Note on the EPIC Regional Conference: Pay transparency in Asia/Pacific: public policy and company practices
3 Nov 2022
In this regional conference organised by the Equal Pay International Coalition on October 26, 2022, governments, employers, workers, and their organisations from the Asia/Pacific region shared their experiences, policies, and practices to make equal pay between women and men for work of equal value a reality, with a particular focus on pay transparency. The agenda of the conference is available at the end of this page.
Context: gender labour market gaps across Asia and the Pacific are persistent
Gender differences in labour market outcomes across Asia and the Pacific remain pronounced. Younger generations have progressively reduced and often reversed the gender gap in educational attainment. This has contributed to the narrowing of gender employment and pay gaps. Nevertheless, there remain substantial differences in terms and conditions of employment between men and women. For example, across the OECD countries in the region, the gender pay gap at median earnings ranges from just below 6.7% in New Zealand to 12.3%, 22.1% and 31.1% in Australia, Japan, and Korea respectively. By comparison the OECD average stands at 11.7%.
To reduce persistent gender wage gaps and raise awareness about systematic pay differences within firms, pay transparency measures have gained momentum in policy packages over the past decade. The goal of such measures is to encourage employers to prevent, and address pay inequity, to give workers and their representatives more information to combat pay discrimination, and to help governments identify when, where, and how to target gender wage gaps.
Mr. Rakesh Patry, Director General for International Affairs, Employment and Social Development Canada, and Chair of the EPIC Steering Committee, opened the conference with welcoming remarks. He stressed EPIC’s contribution to addressing the gender pay gap, including by facilitating exchanges between countries, for instance on good practices, and access to sound data.
Focusing on Canada, he referred to the enactment of proactive pay equity legislation and the implementation of innovative pay transparency measures. In Canada, new pay transparency measures require federally regulated private-sector employers with 100 or more employees to report their pay gap information to the government. This pay gap information will be published on an interactive website next year. Pay gap reporting goes beyond gender. Canada will be the first country to make available various pay gaps (hourly wage, bonus pay and overtime pay gaps) to the public and that will include women, Indigenous peoples, persons with disabilities and members of visible minorities.
Pay transparency: perspectives and policies in the Asia/Pacific region
Mr. Katsumi Ishizu, Director, Equal Employment Opportunity Division, Employment Environment and Equal Employment Bureau, Ministry of Health, Labour and Welfare, talked about gender policy development in Japan. Despite some improvements, the gender pay gap in Japan remains large. Recent legislative developments tackling the gender pay gap include the Workplace Positive Action Act from 2015 and pay gap disclosure today. From July 2022, private companies with more than 300 employees (about 18 000 companies) are required to disclose women’s pay as a percentage of men’s, on their website or elsewhere, breaking down the figures by permanent/non-permanent employees. Any legitimate reason for gender pay disparities will need to be provided, as it is crucial to understand and tackle the causes behind the gender pay gap. Mr. Ishizu’s presentation is available here.
Ms. Kellie Coombes, Secretary for Women and Chief Executive, Manatū Wāhine – Ministry for Women talked about policy developments and practice inNew Zealand. New Zealand does not have public pay reporting in place for the private sector, but public sector agencies publish their pay gaps and the Public Service Commission analyses gender and ethnic pay gaps in public sector agencies. The Government is scoping a work programme for wider pay transparency measures. New Zealand has an innovative approach towards establishing “work of equal value” – 2022 marked the 50-year anniversary of the passing of the Equal Pay Act, which prohibits discrimination in pay on the basis of sex. In 2020, the Act was amended to enable employees and employers to solve pay equity problems without having to go to court. A pay equity work assessment toolkit, “Te Orowaru” helps parties work through the pay equity claim process. Pay equity claims settled to date have resulted in pay corrections for over 100,000 employees. As other important developments, in June 2022 New Zealand launched its first Women’s Employment Action Plan under the Government’s Employment Strategy. The presentation by Ms. Coombes is available here.
Ms. Shelby Schofield, Chief Economist, Office for Women, Department of the Prime Minister and Cabinet, Australian Government, stressed that the Australian Government is committed to an ambitious gender equality agenda. This includes the development of a National Strategy to Achieve Gender Equality, the establishment of an independent Women’s Economic Equality Taskforce and adopting Gender Responsive Budgeting. Closing the gender pay gap is a key priority. The Government has committed to strengthen existing reporting standards, requiring employers with 500 or more employees to commit to measurable targets to improve gender equality in their workplaces, and enabling the Workplace Gender Equality Agency (WGEA) to publish the gender pay gap of businesses with 100 employees or more. It will also lead national push to close the gender pay gap by making pay equity an object of the Fair Work Act 2009; strengthening the capability of the Fair Work Commission to order pay increases for workers in low paid, female-dominated industries; and prohibiting pay secrecy clauses. Ms. Schofield’s presentation is available here.
Mr. Woojeong Kang, Deputy Director, Women’s Policy Employment Division, Ministry of Employment and Labor, Korea, talked about policydevelopments and practice in Korea, where a wide gender pay gap has been a long-standing issue. Korea has implemented Affirmation Action since 2006, whereby companies whose ratio of female employment and female managers fall below 70% of the average of the same industry and of businesses in similar size must submit an implementation plan and a related performance record. After deliberation by the Expert Committee, a list of companies that fail to follow Affirmation Action is published annually since 2017. In 2019, data reporting obligations were expanded to both local public agencies and companies with at least 300 employees among firms with disclosure obligations. As of 2020, all companies for which Affirmative Action is applicable must submit gender data on wages, years of service and share in each wage bracket. Firms are also encouraged to provide an analysis on drivers of the gender wage gap after a voluntary review of their data.
Ms. Tomoko Hasegawa, Managing Director, Keidanren – Japan Business Federation, discussed key corporate practices in Japan. Company initiatives to support women’s empowerment in Japan include management commitment (e.g. concrete plans supporting female managers); actions to create a working environment conducive to work-life balance; expansion of responsibilities and strategic job rotation (e.g. active appointment of women to stereotypically male positions); training provision (e.g. to eliminate unconscious biases); and provision of opportunities for exchange and awareness raising (e.g., online fora for conversations between employees facing common issues). Keidanren will further promote workforce diversity as part of its post-COVID-19 “New Growth Strategy”. They have set an aspirational target for 30% of executives to be women by 2030. Examples of interventions supporting girls and women in STEM were also mentioned – such as the “Summer Rikochare” (Science and Engineering Challenge). Ms. Hasegawa’s presentation is available here.
In the Q&A session, the speakers stressed several factors related to pay transparency, including the importance of a real commitment to gender equality and a learning culture on what works well and not so well; the importance of providing sufficient incentives for companies to adopt equal pay and pay transparency practices; and the identification of key barriers to equal pay, such as horizontal segregation and strong gender norms.
Corporate practices to support equal pay for work of equal value: workplace experiences from the Asia/Pacific region
Ms. Joni Simpson, Senior Gender Specialist, ILO Regional Office for Asia and the Pacific, discussed gender-equality practices in Asian companies. Referring to a recent ILO publication, she stressed that pay transparency is an important measure in a range of tools that companies can adopt to reduce the gender pay gap. Through pay transparency, employers can also show their commitment towards gender equality and inclusion at work. In Asia/Pacific, some multinational companies (e.g., in the garment sector) are promoting gender equality practices and non-discrimination, including through pay equity practices (for instance collecting wage data, promoting wage management systems, not asking salary history in hiring processes). This can have positive spill-over effects also on other companies along the supply chain. Critical factors for successful pay transparency measures are the consultation between employers and workers; the compulsory nature of the measures; their rules depending on the size of the enterprise; and the need to provide sufficient capacity building to employers, for instance to produce pay reports. Ms. Simpson’s presentation is available here.
Ms. Kumie Inoue, Executive Director of the Policy Department in charge of the Gender Equity and Diversity Promotion Division, Japanese Trade Union Confederation (JTUC RENGO), provided the perspectives from a Japanese trade union. After showing significant gender gaps between regular and non-regular employment in Japan, she focused on existing key barriers for women to succeed in the labour market. These barriers relate to employment (around a third of companies in Japan are not hiring women), access to training (most people attending training are men), difficulties to continue working (a key reason for quitting a job related to difficulties in balancing work and childcare), and promotion (only 10% of women hope to be promoted to section manager or higher, a key reason again being difficulties in term of work-family balance and unconscious biases). JTUC RENGO insisted on the need to identify and tackle the factors that lead to wage disparities. Ms. Inoue’s presentation is available here.
Ms. Selim Choi, PhD, Employment Policy Research Division, Korea Labor Institute, focused on corporate practice in Korea. In Korea, the pay scale is transparent, detailed and non-discriminatory. Yet, female workers tend to have lower average pay within firms due to their shorter tenure, lower rank positions, shorter hours of work, and jobs without characteristics that are typically rewarded through extra salary. Korea’s labour market is highly segmented, and there are job hurdles for women since the very beginning of their career. Women also have high chances of career ‘termination’ (not interruption) during their 30s. The Government has promoted gender equality through different actions, such as making direct or indirect discrimination illegal, affirmative action and generous parental leave. On the other side, voluntary actions by companies to reduce the gender pay gap are still not common: while various companies provide for additional parent benefits to promote work-life balance, efforts to recruit and foster female managers are still limited. Key actions needed to reduce the gender pay gap in Korea include career retention support during mid-career for mothers as well as lowering bars for employment opportunities for women. Ms. Choi’s presentation is available here.
Ms. Rae Cooper, Professor, University of Sydney Business School, presented some reflections on corporate practice in Australia. This comes at a time of important policy changes, as policy reform is expected to ensure increased support for childcare and parental leave. Specifically, on pay equity, various companies are leading with example in the private sector, as is the State of Victoria in the public sphere. Leading companies are incorporating pay equality and transparency as part of broader gender equality actions. This means that pay reporting is not just a formal reporting exercise; rather, these processes are built in their ecosystems and used to analyse the drivers behind the gender pay gap at different levels (gender segmentation and segregation). Preconditions for successful pay transparency and pay equity practices require a combination of factors: an ecosystem approach, where gender pay is an output of the system; a leadership that understands the need for equality and equity; making flexibility available to all people across the organisation; having good data and using them in the appropriate way; and an ongoing gender equality mindset.
In the Q&A session, the speakers stressed several factors related to pay transparency, including the need to address unpaid caring responsibilities and to tackle the motherhood penalties; eradicating any form of violence and harassment; ensuring a gender lens when considering precarious employment; and accompanying an important change in social norms, behaviours and gender biases.