Gender equality reporting is not 'red tape'

Amid the federal government’s broader agenda to cut red tape, business groups are reportedly lobbying the federal government to weaken legislation requiring companies to report on gender equality measures.

The Business Council of Australia, previously a supporter of such reporting is said to be among the lobbyists arguing it is too onerous and expensive.

Legislation for workforce gender equality was first introduced in 1986 and revised in 1999 and 2012. It applies to all private sector employers and higher education institutions that employ 100 or more people.

Gender reporting changes with governments

The Hawke Labor government’s Affirmative Action Act required companies to develop and report on an affirmative action plan to provide equal opportunity for women in their workforce, and to report on their progress in implementing the plan. Plans were supposed to set targets for inclusion and promotion of women, but there was little incentive for compliance - the only sanction was being named in a report to Parliament, and the monitoring agency had limited powers and resources.

Howard government changes in 1999 renamed it the Equal Opportunity for Women in the Workforce Act, reduced reporting requirements, made more of the data confidential, and allowed organisations that complied to report every two years rather than annually.

The Gillard government’s 2012 changes to the Act aimed to make it more effective in encouraging companies to act on equal opportunity for women at work. Consistent with the modern emphasis on monitoring outcomes and indicators rather than inputs and processes, the Workforce Gender Equality Act 2012 shifted the emphasis in reporting from policies and their implementation to workforce data.

Employers are required to report on several “gender equality indicators”, including the gender composition of the workforce and governing bodies such as councils or boards of directors; pay equity between women and men in the workforce; and availability and use of flexible working arrangements for male and female parents and carers. Reporting was made more transparent: reports are publicly available except for personal information and pay data, which can only be reported in aggregate form. Employees and shareholders have to be notified about the report and how to access it.

Toothless tiger

The Act’s only requirement is for employers to report data on their workforces once a year to the Workplace Gender Equality Agency. It does not require any particular workforce practices to be adopted. Companies that fail to improve gender equity at work are not punished. The only incentive for change is positive recognition.

The Agency recognises top performing companies through awards, by its Employer of Choice for Women certification, and by publicising best practice initiatives. It also publicises “the business case”, the evidence of the benefits to business when there is greater equity for women in a company’s workforce.

Even with compliance by major companies, change in the workforce has been glacial. The Workforce Gender Equality Agency’s annual Census of Women in Leadership has shown negligible improvement in the proportion of women in senior executive ranks in Australia’s top 200 companies over ten years.

Pay equity data shows the current pay gap between men and women is 17.5% and has consistently been between 15% and 18% over the past two decades. This suggests that little or no progress has occurred in moving towards workforce gender equality. Women remain concentrated in a small range of industries that pay less than male-dominated industries, and in all industries women have lower pay and lower workforce status than men. Some of this gap might be explained by family and caring responsibilities that some women have, but the fact that it affects women who don’t have such responsibilities (for example the gender gap in graduate pay immediately out of university, indicates the pervasive and complex nature of the issue.

The alternative is a data void

Is reporting by employers unjustifiable and wasteful red tape? It applies only to employers of more than 100 people, not to small businesses. They are likely to have staff with human resources (HR) responsibilities, so obtaining the data and completing the report will take little extra work beyond normal HR reporting and monitoring functions.

Do the benefits of reporting justify the extra time and effort? Information on an employer’s workforce and how it changes from year to year allows both assessment of the employer’s progress on gender equity, and identification of effective practices. This knowledge is not available from anywhere else and is essential to understanding both progress and the barriers to progress in gender equity at work. Reports will give shareholders, employees, job seekers and the public a concrete view of whether a company’s expressed commitment to gender equity at work has led to improvements in practice.

The Act avoids prescriptive rules, relying instead on obtaining better information through reporting. Without it, working women, and especially young women entering the workforce, cannot expect equal pay and treatment at work. Given these benefits, and the relatively small effort involved, it is hard to avoid the suspicion that objection to the Act as red tape might instead be a cover for big employers’ reluctance to expose their employment practices to scrutiny.

While providing data by itself may not ensure progress, a better understanding based on collected data, and company accountability to employees and shareholders, is likely to provide a significant impetus for change.

Beth Gaze receives funding from the Australian Research Council