Fair Work Commission found to play key role in gender pay gap

A new study has found that the Fair Work Commission has a key role to play in the gender pay gap.

Fair Work Commission found to play key role in gender pay gap
Even the Fair Work Commission seems to give men the upper hand when it comes to wages. Photo: deagreez, Bigstock

A new study has found that the Fair Work Commission Australia inadvertently plays a key role in the gap between male and female wages. Whilst much of the wage gap, 18%, is due to employers paying workers above minimum wage, around 10% is due to minimum wage itself.

Whilst minimum wage is minimum wage and would, at first, appear to be the same for everyone, this is in fact not the case. Depending on the job at hand and years of experience the minimum wage varies between industries.

The study was conducted by the Melbourne Institute with results being released on Monday. Barbara Broadway, one of the authors of the study, said that there are “currently 122 federal awards covering a variety of industries and occupations” meaning that there are many different minimum wages throughout Australia.

Men and women, typically, partake in very different jobs and this is the major influence on the minimum wage gender pay gap.

An examination of records from the Household, Income and Labour Dynamics survey conducted as part of the study showed that upwards of 90% of jobs held in the construction and road transport jobs are held by men. Contrastingly, women hold upwards of 80% of the jobs in retail, accommodation and social services.

The minimum wage in construction and road transport sees minimum wage of $22.58 and $20.83 per hour respectively. Those working in retail, accommodation and social services get paid between $15.67 and $18.27 an hours – a 22% decrease in average minimum wage.

In the case of minimum wage, the gender pay gap cannot stem from any form of employer discrimination based on gender. It is difficult to determine whether the laws surrounding minimum wages based on industry do employ any form of discrimination.

Many of the construction and road transport jobs could be deemed as more dangerous and dirty when opposed to those of retail and accommodation services and could be the reasoning behind the minimum wage difference. The study concludes, however, that the minimum wage rates have been determined based on what is appropriate.

The study outlines that those fields dominated by males may be the beneficiaries of “a long history of unionisation that led to higher wages” the study says.

Regardless, it appears that the Fair Work Commission is much fairer than wages determined externally from the commission. Jobs requiring a university education see no discrimination from the commission.

Ultimately, the study concludes that the wage gap is not only a matter of negotiation but is more often than not entrenched within legislation. The challenge is bridging the gender pay gap lies beyond the surface of simply paying women the same. It requires a deeper development both within the awards and encouraging negotiation by women for higher wages.