Companies public and private with more than 250 workers would have to publish a gender pay gap report as part of government plans to help shrink the 9.2 per cent pay gap between men and women.

Within four years, the net would be widened from these 900-odd companies to all those with more than 100 workers (2700 companies), Minister for Women Jan Tinetti and Associate Workplace Relations Minister Priyanca Radhakrishnan announced this morning.

By that time, the voluntary requirements to have a plan to reduce the gender pay gap may have already become mandatory alongside the reporting requirement.

“While action plans will be voluntary at the start, we will review this after three years to determine whether it needs to be made mandatory,” Radhakrishnan said.

All this, though, assumes the next Government would want to continue the current Government’s plan to draft up legislation requiring the gender pay gap reporting.

There is no timeline for this at this stage, nor a bill that the Government is ready to introduce before the House rises at the end of the month.

Radhakrishnan said the Government also wanted to explore fixing the ethnicity pay gap.

“Māori, Pacific peoples and other ethnic groups often face the compounding impact of both gender and ethnic pay gaps. Through this next phase of consultation, we’ll be able to consider the inclusion of ethnicity before legislation is drafted.”

She said announcing the Government’s intention is hoped to elicit input from stakeholders into how the system should be designed before the legislation is drafted.

“Around 200 companies including Spark, Air New Zealand, My Food Bag, and Sharesies are already voluntarily reporting their gender pay gap or committed to start reporting. We’ll be engaging with them to learn from their experience and establish a universal model for reporting so there is consistency and guidance for employers and workers,” Radhakrishnan said.

According to the Ministry for Women, the gender pay gap has reduced steadily from 16.3 per cent in 1998 to 9.1 per cent in 2011 but has fluctuated over the past decade. For the June 2022 quarter, it was 9.2 per cent.

“The majority (80 per cent) of the gender pay gap is now driven by what the research calls ‘unexplained’ factors,” the ministry said. “These are the harder-to-measure factors, like conscious and unconscious bias and differences in men’s and women’s choices and behaviours.”

Looking at data from the Household Labour Force Survey in 2021, MindTheGap says that current inequities favour income levels for Pākehā men.

Earnings relative to gender and ethnicity. Source / MindTheGap

Minister for Women Jan Tinetti said the reality was that women and men had different experiences in the workplace.

“Change is needed. Requiring companies to publish their gender pay gap will encourage them to address the drivers of those gaps and increase transparency for workers,” she said.

“Countries we compare ourselves to including Australia, Canada, and the United Kingdom have already successfully introduced gender pay gap reporting.”

Derek Cheng is a senior journalist who started at the Herald in 2004. He has worked several stints in the press gallery and is a former deputy political editor.