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STANDING COMMITTEE ON EMPLOYMENT AND WORKPLACE RELATIONS
02/04/2009
Pay equity and increasing female participation in the workforce

CHAIR —Welcome. In what capacity do you appear today?

Dr Charlesworth —I am appearing today as an academic expert in the area of gender equality in employment.

CHAIR —Although the committee does not require you to give evidence under oath, I should advise you that this hearing is a legal proceeding of the parliament and therefore has the same standing as proceedings of the respective houses. We have not received from you a written submission to this inquiry. Do you wish to present a submission or make an opening statement before we approach you with questions?

Dr Charlesworth —I have not made an individual submission in my own right. At the time of submissions I was overseas on study leave and, quite frankly, was suffering from submission fatigue, having made submissions to the National Employment Standards inquiry and to the efficacy of the Sex Discrimination Act inquiry that was conducted by your colleagues in the Senate.  However, I was one of the three main drafters of the submission that you have received—unfortunately, it is not on your website—from the Work + Family Policy Roundtable—

CHAIR —Was that sent to Alison Preston?

Dr Charlesworth —Yes, Alison Preston.

CHAIR —I do not think we have officially received it.

Dr Charlesworth —It was sent to you on 18 November 2008. It is not on your website, however. I would be happy to forward you a copy.

CHAIR —I did have a similar conversation with Dr Preston when I ran into her. She has forward me a copy. I meant to raise it with you because I have not seen it either.

Dr Charlesworth —I am not necessarily going to talk about that submission in detail. I am not representing the Work + Family Policy Roundtable here. Dr Elizabeth Hill from the University of Sydney and Professor Barbara Pocock from the University of South Australia are the conveners. The submission went in on behalf of the Work + Family Policy Roundtable under both their names. In that submission there are various issues that I would not mind raising.

In addition, when I was overseas last year I contacted the committee directly. I had been approached by the Australasian Council of Women and Policing because they said there had been some interest in the issue of pay equity and women police. I had at that stage just completed a three-year study at Victoria Police looking at the concept of quality part-time work. The findings are extremely relevant to your deliberations—

CHAIR —I think we had the Police Federation—

Dr Charlesworth —I have looked at the Hansard of their evidence and their submission. In their submission they quote a small section from the final report that went to Victoria Police.

I will give you a little background. This would normally have gone into a submission. I have a background as a social worker and a researcher. I have been an academic researcher only since 2001 when I completed my doctorate in legal studies at La Trobe University on the impact of industrial relations and sex discrimination legislation on sex discrimination in the workplace. The finance industry, specifically the banking industry, was the case study for that doctorate. I have long experience in the area of women’s employment, going back to the late 1970s with the Western Region Working Women’s Centre. I have worked as a researcher for unions around women’s issues—for the Liquor, Hospitality and Miscellaneous Workers Union and for the municipal employees union, which later became the Australian Services Union. I have worked in the state public service in the Women’s Employment Bureau under the Cain Labor government.

Mr HAASE —Which state?

Dr Charlesworth —Victoria. I worked as a contract researcher, juggling my own work and family responsibilities. During that time I undertook a pay equity study of home care workers for the then federal department of industrial relations’ pay equity unit. I undertook a study of pay and equity in overaward payments in local government for the then HREOC overaward payment inquiry. I did a study on the impact of enterprise bargaining on women workers for both the Human Rights and Equal Opportunity Commission and the ACTU.

I have had a number of relevant government appointments. From 1988 to 1994 I was a member of the Victorian Equal Opportunity Board, which was then the tribunal that dealt specifically with discrimination matters under the Victorian Equal Opportunity Act. I have been a member of the academic advisory committee to the human rights commission’s striking the balance study in 2004-05. From 2007 to 2008 I was a member of the Victorian advisory committee for the review of our Equal Opportunity Act. I was a foundation member of the Victorian government’s Working Families Council and, as Sarah Tuberville indicated, pay equity is one of the key issues for the council. I am currently a member of the federal sex discrimination commissioner’s expert panel on sexual harassment.

In my academic work I have taken a number of pieces of work that are relevant to your inquiry. I had an Australian Research Council postdoctoral award, where I looked at workplace understandings of sex discrimination—how is sex discrimination understood in the workplace? I undertook a project with Professor Belinda Probert and Philippa Hall, then from the New South Wales Office for Women, looking at nine best practice organisations and at the contexts and drivers for equal opportunity—what in fact drove large organisations to take action around a variety of issues. I undertook a pay equity study back in 2003 on the Victorian Public Service. Only the first part of it has been published. I have been part of a large ARC grant looking at this idea of quality part-time work and building a conceptual framework—how can we understand when part-time work is good quality or poorer quality? We have undertaken specific occupational studies of cleaners, retail workers and solicitors. And there was that project I mentioned with Victoria Police.

I have also been involved with Associate Professor Marian Baird in a two-organisation case study. I looked at a large Victorian auto manufacturer, Marian looked at a large New South Wales water authority, and we sought to understand the relationship between gender equity, business efficiency and work-life balance. That project is now complete.

In 2007 I undertook a project for the then Victorian Workplace Rights Advocate on pregnancy discrimination, just trying to understand what is happening around that. And I was also part of a large ‘vulnerable workers’ project. The Human Rights Commission funded the first part of that—that was the work of Professor Alison Preston—to look at what data we have and need to understand gender pay equity. I am sure you have that report available to you. It is a goldmine, really. Then the individual state governments funded various researchers in different states for a qualitative piece of work looking at the impact of Work Choices on women vulnerable workers. In Victoria, the Victorian government wanted both men and women, so my individual study here, conducted together with Fiona Macdonald, looked at 23 women and seven men across a variety of industries and really just tried to get their stories. Those projects are all completed.

My current work, which comes out of my study leave, which I spent at the International Labor Organisation’s training centre in Turin last year, is looking at the notions of what is decent work and how gender equality is part and parcel of that. The ILO—and we refer to it in our work and family policy roundtable submission—has a current campaign which asserts that gender equality is at the heart of decent work, and that is certainly one of the key agenda items for the ILO’s conference this year in June.

Coming out of the work we have done around solicitors and part-time work, you would not be surprised that we have been doing some work around long hours and solicitors. My colleague Iain Campbell and I are currently working on an attrition study on solicitors in private legal practice in Victoria. I am also involved in a large ARC grant looking at work-family balance in regional Victoria and in a cross-national study on gender and working time arrangements. That gives you my background.

As I said, in terms of this inquiry, my only direct involvement has been as one of the co-authors of the work and family roundtable submission. I wrote a letter after being contacted by ACWAP and sent details of some published research that had come out of that project. I did suggest, because it has still not been externally released by Victoria Police, that the committee ought to contact Victoria Police and get a copy of the study. I am sure that they would respond very favourably to that.

There are clearly a lot of things that I might talk about. You have been receiving lots of evidence. I have been interested to track the progress of your hearings, but for me, I suppose, gender pay inequity is the canary in the mine in terms of women’s employment. It tells you something is wrong—it does not necessarily tell you what is wrong; it does not necessarily tell you what causes it.

The other broad statement about gender pay inequity is that it underpins but is also reinforced by other manifestations of gender inequality. As I am sure the committee has heard, it is extremely complex. It does not just happen in the labour market and workplaces; it happens in terms of, for example, the very gendered and polarised working time regime we have in Australia. In Australia a lot of women work part time, a lot of men work full time, but if you have a look at the distribution against comparable countries like the Netherlands, which has one of the highest proportions of part-time work in the OECD, women work substantial part-time hours, between 25 to 35 hours, and men work what you would call standard full-time hours, between 35 to 40 hours. In Australia, women are clustered at the short hours end of work, men are clustered at the long hours end of full-time work. That has lots of ramifications for pay equity.

In terms of one of the questions you asked the Workforce Victoria representatives, we do have evidence that those who work short part-time hours do want more hours of work—any preference data tells us that—and those who work very long hours of work want less hours of work. Obviously, what each individual wants is going to be constrained by the various options they have open to them. I also heard the Workforce Victoria representatives talk about broader issues such as child care. I would throw in paid maternity leave and, in particular, gender inequality in the sharing of caring work in the household, which is the other side of pay inequity. Pay inequity both reinforces that unequal sharing of work in the household and is also very much related to it in terms of the expectations we have in Australia.

In Australia we have a very ambivalent view about women in the paid workforce. We think, yes, it is good that women work, but we do not really think it should be their prime concern: ‘Yes, they should work, and maybe part time is okay, but their prime business is really looking after the family.’ That attitude is not only societal; it is very much there in the workplace. In terms of current discussions about downsizing of workplaces, I think one of the very real risks is that there is an assumption that, whatever else we do, we must preserve those traditional male breadwinner models. We are not looking at what is happening in the community services industry, where women are losing hours of work—that somehow just does not come into it.

Antidiscrimination in industrial relations legislation is critical, clearly, but it is not the whole story. For example, in our new Fair Work Bill, yes, we have got a new pay equity provision, but it is in fact quarantined from the rest of the legislation. It is stuck in a protection part of the act, along with antidiscrimination provisions. There is no sense that the way in which work is organised or structured and skills classification are also absolutely critical to pay inequity. We refer to this in the Work + Family Policy Roundtable submission, and I think the decision of the Australian Industrial Relations Commission to remove the antidiscrimination clause from awards in the award modernisation process is a great loss. You could argue that was just a motherhood clause: it said nothing could discriminate. But if you talk to industrial relations commissioners they will tell you that having that clause there meant they could say to unions and employer associations, ‘What you are suggesting may have some indirect discriminatory effects,’ and it was very important that it was there. So I think it is a great loss that it is no longer there. Also, we see in the new National Employment Standards that casual workers are in effect excluded from lots of the provisions. Given that women make up 60 per cent of casual workers, what seems to be just IR, and not to do with discrimination or pay equity issues, in fact really has quite a profound impact on pay equity.

What I would like to talk a little bit about is what gets left out when we think about pay equity in Australia. We think that, yes, we have antidiscrimination provisions and industrial relations provisions, but I think we need to turn our mind to how those are actually implemented. For example, in the community services sector, because of tight funding arrangements or funding arrangements, which the Australian Productivity Commission found with regard to the aged-care industry have absolutely no relation to the cost of providing aged care, there is some evidence that agencies are cutting back the hours of workers but then expecting them to work their previous set of hours. That is not seen as a pay equity issue, but it has pay equity ramifications.

If we take, for example, home-care workers in Victoria, home care is mainly delivered through local government. The feds kick in 60 per cent and the state kicks in 40 per cent of the cost but, in reality, local government provides 17 per cent of total HACC funding. It depends then on the local government. More progressive, wealthier local governments kick in more, but rural councils in particular find that very difficult because they have a lower ratepayer base. They can solve the problem by popping all the home-care workers on band 1 of the skills classification, not because that reflects the work that those workers do but because that is the only way the council can deliver the service. So I want to draw your attention to these accidental things that happen. It is not because somebody wakes up one morning and says: ‘I know what I’m going to do. I’m going to pay women less than men.’ That is not what happens. It is these other kinds of structures and arrangements that really shape what happens in respect of pay equity.

CHAIR —Ironically, home-care workers in Victoria are the highest paid home-care workers in Australia.

Dr Charlesworth —Indeed.

Mr HAASE —So it is worse elsewhere.

Dr Charlesworth —Absolutely, it is worse elsewhere. Indeed, when the federal government mooted that they were going to bypass the state government there was a lot of concern here, because in other states a lot of that home-care funding goes to private providers, and they are not paying penalty rates or travel time as you travel between clients. It is a sector that employs a lot of women, and I go back to this view that we have about women and where their proper place is—it is caring work. It is kind of an extension of what they do. If you talk to home-care workers or community services workers, they feel that too. They do this work because they are caring. But I am not sure whether or not it is fair that they then have to pay a price in terms of being paid what are very low award wages. Legal wages are very low, but what I am talking to you about are practices that are technically illegal but which have never been chased up because services would not function.

CHAIR —Industries like aged care, child care and community services are areas where we would be extremely grateful if you could give, in addition to comments about the issues and concerns, practical solutions or ideas for addressing them. Under the new legislation what is referred to as the low-paid bargaining stream—and I am particularly referring to the ability to call in a third-party, which in this case is often the funding authority—will address these issues in some way. These are considerable industries and they are still facing significant skill shortages. Despite what is happening in the broader economy, I think that will continue. I cannot see it changing dramatically.

Dr Charlesworth —I suppose it is the bleeding obvious, but really the whole funding structure needs to be looked at. It is very hard to get any research project up in this area because people say, ‘If you’re going to talk about wages and conditions we’re not interested, but you can talk to us about what can be done.’ In fact, a Department of Human Services report on the disability services sector found wages and conditions were the main retention and recruitment problem in disability services. It said in effect, ‘We can’t really touch the funding structure but perhaps we can have employee recognition schemes like employee of the week.’ That does not exactly pay people’s rent. While there is an assumption that a lot of community services workers are secondary earners in their family, the reality is a lot of them are sole breadwinners and their hours of work are totally critical.

CHAIR —And they are occupations in which women feel more comfortable returning to work.

Dr Charlesworth —If you go into home care in a non-government sector agency or a local government agency, they can avail themselves of the government’s traineeships in this area. Those do not give recognition of prior learning, but they are a way of giving people a skill base. A certificate III, for example, in home care is a marketable commodity, and I think that that is fantastic. But it then very much depends on who employs you as to whether your skills are going to be remunerated.

Another area is raised in our pregnancy discrimination report. We have had since 1979 an unpaid parental paid leave standard which says that women should be able to return to their previous job if it exists. What we found in our report—and indeed there is an ABS study that indicates this—is that 22 per cent of women who were in employment when they were pregnant experienced difficulties. Those difficulties are numerous. One of the really big issues, though, is not just the discrimination that happens when women are pregnant—such as them getting sacked, for example. Employers might say, ‘Dear, it would be better for you if you went casual, because then you can do your antenatal leave and we do not have to worry about it.’ People say, ‘That seems like a good idea.’ But they have just lost all their accrued sick leave. People are not necessarily industrially savvy. This is a huge issue.

When women want to return to work, people say, ‘We’d love to have you back, but we’ve found someone else who can do the job.’ There seems to have been a normalisation of the breach of this particular standard. That is of very great concern. The standard has now been reproduced as part of the National Employment Standards, which is terrific. But we should be looking at what happens elsewhere, such as in Europe. In the UK, if you are sacked when you are pregnant that is prima facie evidence of discrimination. The employer has to prove that it was not discrimination. There are steps that you can take, and Australia is well placed to make them.

The other area is accidental or unintended consequences. We have been talking a lot in the media about an issue dear to my heart: the ‘right to request’ provisions—the extremely weak ones—that are now in the National Employment Standards. Australia drew very much on what has happened in the UK. In the UK, they have had a limited right to request. Both under Blair and Brown, the UK government has researched the impact of what they do. They do not just put legislation into place; they give employers funds to see how it is going; they get consultants to do reviews.

In one of their reviews on the take up of the right to request, they found a number of things. They found that women applied much more than men to vary their work arrangement and that when women applied they were much more likely to be accepted. The few men who applied were much more likely to be rejected. When they asked people who had availed themselves of the right to request what had happened, they also found that around about half of them said that they had suffered some negative consequence as a result. Because it is women who are accessing those flexible work arrangements, that then has gender implications. It means that when provisions are put into place there needs to be careful evaluation. Nobody expected that to happen; they thought, ‘This is great: it is open to men and women.’ On the face of it, there is absolutely no discrimination.

Part timers were much more likely to avail themselves of it than full timers. That tells you two things: firstly, part-time work is not inherently flexible; and secondly, it also tells you that, if you are already seen as being on a non-career track, then you can afford to use those little flexibilities. But if you are serious about your career, even if you have provisions in the workplace—and there are lots of instances of that—people simply do not take them up.

I will briefly draw your attention to other accidental practices. When I was doing this work with Belinda Probert and Philippa Hall, I was talking to one of the professional services firms that we were looking at about their HR software system. We were looking at how organisations collected data and how they evaluated the impact of what they did. The then director of human resources said to me: ‘We’ve just got a new software system. We ran some numbers through. We decided to have a look at salaries. We found quite a few women—senior managers—supervising men who were being paid more than them. We got a fright. We though that the numbers must be wrong. We ran it again and found that it was indeed the case.’ They were shocked to their back teeth. Once again, it is not because anyone woke up in the morning and said, ‘I’m going to pay women less than men.’

This company was concerned because it has a British subsidiary and at that stage there were talks of gender pay audits being mandatory in the UK context. Immediately, they put in place various steps. They found that it happened at the appointment stage. They then put in place a requirement that there be some oversight of the salaries that people were appointed on. This was one very simple thing that they were able to do.

They then looked more closely at their bonus systems. In most companies, bonuses tend to be absolutely opaque with nobody really knowing what is happening even within the company about what kind of bonus person A or person B got. But they used their better IT technology to an end. They saw this as a risk management exercise. They did not want, some time down the track, someone waking up and realising that they were being paid less than the men that they were in charge of. That gives you an example of the kinds of accidental things that happen.

In an automotive company that I was looking at, there was a part timer in a team. The team got a bonus together. It was five per cent that year. But her manager said to her: ‘You’re part time, so I’ll give you 2.5 per cent.’ You do not need to be arithmetically literate to realise that that was a double discount. But that happens—

CHAIR —All the time.

Dr Charlesworth —All the time, because people think, ‘She’s kind of half a worker, so she’s not really pulling her full weight.’ There is this view in organisations where part timers are not common that somehow you need to—

CHAIR —They think that they do not do as much.

Dr Charlesworth —Yes. There are, for example, the promotion practices of the Victoria Police. I know the federation drew your attention to this. In Victoria Police—and this is the case in most police services—in order to get promotion you have to do substantial acting up duties. And you have to do those acting up duties on a full-time basis. That is something from our work that Victoria Police are directly addressing. I have to say that—

CHAIR —A point of clarification: when you use the term ‘acting up’, you mean ‘being engaged in a role in an acting capacity’.

Dr Charlesworth —Higher duties.

CHAIR —As opposed to ‘antisocial behaviour’.

Dr Charlesworth —Yes. That is one example. The funding of the community services sector is another one. Neither the state or federal governments set out to say, ‘We’re going to reinforce gender pay inequity in Australia.’ They are simply trying to minimise the funds that they expend. They kind of know that, if they do this tendering out process, agencies fall over themselves to try and get the funding. How they get the funding is by in fact impinging on the wages and conditions of their paid work force.

The other big issue in the community services sector is to do with people who work very short hours and at the front line. There has been an interesting study of community services by Gabrielle Meagher at the University of Sydney. The people at the front line work very short hours—between 11 and 15 hours per week. That is not a living wage. In my experience, how they make a living wage is by making themselves available to flex up hours. If someone is sick, many will flex up. But if you do it for a while then you get used to having 25 hours in your family budget. But then it can be cut back to your guaranteed minimum hours at any stage. And you get flexed up at ordinary time rates; it is not over time. If you are a full-time or part-time manufacturing worker and you worked additional hours, you would be paid over time for the hours above your regular hours.

CHAIR —That is regularly seen as an imposed bargaining initiative and an efficiency measure. With industries becoming increasingly part time, it meant that an employer, rather than going to an outside casual agency, would look to their own staff to increase the hours of work. I appreciate the impact that it has, but that was the—

Dr Charlesworth —But it is interesting that those ‘efficiencies’ were gained in industries like community services retailing that had no fat to cut, unlike the efficiencies being gained elsewhere. I did a comparison of outdoor workers and home care workers in local government. Outdoor workers could give up their dead animal allowances, they could give up their dirt allowances, they could give up their wet weather allowances—

CHAIR —And their wash up time at the end of shift. Those issues exist. Frankly, you can put a pretty cogent argument together that the pay equity gap started to increase in Australia coincidentally with the introduction of enterprise bargaining—even before the situation of individual contracts and Work Choices.

Dr Charlesworth —Absolutely. I agree.

CHAIR —You said that they do not get an additional rate of power for the additional hours when they are casual. Are they on a casual rate?

Dr Charlesworth —No. These are permanent part-time workers. I was referring to them doing flexed up hours. Casual workers can work—

CHAIR —Yes. So the casual rate per hour is in addition to the ordinary rate per hour for a full-time worker.

Dr Charlesworth —No. I will take local government as an example because I know that award and the enterprise agreements very well. There is an hourly rate of pay that you receive as a permanent part-time or a permanent full-time; it is the same. If you work on a casual basis, there will be a loading.

Mr HAASE —Naturally. Is there a loading in the case you are speaking of—those flexed hours?

Dr Charlesworth —No. So, in fact, turning part-timers into casual workers is kind of a backdoor way. No, there is no additional loading. Good employers make sure that they get superannuation paid on those additional hours and that their annual leave has those additional hours—

Mr HAASE —So they work for the same rate per hour as though they were a full-time employee.

Dr Charlesworth —Yes, exactly. That is correct—or a permanent part-time employee.

Mr HAASE —That is the lowest rate per hour if they are categorised as a permanent employee?

Dr Charlesworth —Yes.

CHAIR —That would be a fairly standard practice right now—say, throughout the community services area, where part-time work predominates.

Dr Charlesworth —But in disability services they use a lot of casual workers. Typically, if you work for an agency, you work on a casual basis for two years and then they will make you permanent part-time. Then they will use salary sacrificing to make your wage a bit more attractive, but we have recently done some work and found some examples of agencies that claw back part of the benefit of salary sacrificing not so they can go on holiday but merely to run the service, because they are so desperate for funds. So salary sacrificing, I think, has been a really mixed blessing to try and beef up wages, particularly, workers for the not-for-profit community service agencies where it is available.

Mr RAMSEY —One of the things we are coming across is this sectorial discount, where we have a lot of women working in a particular area. This is something that I have noticed over a number of days and have raised a couple of times. In a lot of the industries that women predominate in—health, aged care, child care, education and disability services; we have covered a lot of them this morning—it seems to me that the base wage rate is driven by governments. They are the predominant funding source, and they are the predominant employers across the sector, so that is where it is being driven from. Given that, to address that sectorial imbalance or undervaluing of work in that area, governments need to go back and convince their taxpayers that they are either going to raise taxes substantially to address this or cut the number of services they have. Probably, regardless of who is in government, they risk losing government over just those issues. How do we go about addressing that? This is a fundamental stumbling block.

Dr Charlesworth —It is.

Mr RAMSEY —I do not think it is nasty private enterprise people out there picking on these women; it is actually driven by government, and all these governments hold their hands in the air and say, ‘We really want to do something about wage equity.’

CHAIR —Sure. We used to refer to it as the Pontius Pilate system of funding when I had my old industry union hat on, because it is all care and no responsibility for what actually transpires on the ground.

Dr Charlesworth —There are also, though, retail and hospitality, where there are appallingly low wages too, and they are overwhelmingly private sector. But I take your point.

CHAIR —The point made to us in hospitality, to be fair—defending our representative yesterday—was that the actual hourly rates of pay in their industry were higher than the hourly rates of pay in the community services industry.

Dr Charlesworth —Yes, but are they paid those rates?

Mr RAMSEY —I would suggest that that is an anecdotal thing.

Dr Charlesworth —No, I do not think it is anecdotal. If you go to your Workplace Ombudsman, you will find that they have done an audit in hospitality. There is substantial underpayment in hospitality.

Mr HAASE —If I may, Chair—I am sure, Dr Charlesworth, that you will not mind—I had a discussion this morning with the young on-desk person across the road at the Mercure. She is on casual. She is working 54 hours a week. She has taken out a home loan as of three months ago and is loving it. She is paying off a home on casual wages as a single mum, working for the Mercure.

Dr Charlesworth —That is fantastic, but I hope that they do not cut her hours.

Mr HAASE —There are 54-hour casuals. You see, we get the impression that people are put on casual for flexibility, but often if you have an employee then you can put them on a casual basis and pay them more, because if they were full time they would get less for that number of hours of work.

Dr Charlesworth —But they would accrue other things like annual leave and sick leave.

Mr HAASE —Yes, but that does not pay the bank loan.

Dr Charlesworth —No. Really, good luck to her. I would feel nervous in this global financial crisis, though, about whether her 54 hours a week can continue.

Mr HAASE —Of course. It is nice to have it locked in at fixed interest at a low rate.

Dr Charlesworth —Can I come back to your issue, Mr Ramsey. It is a really critical one. In Canada they had a big pay equity case in the public service. After many years it was won, and finally the Canadian government said, ‘We can’t pay.’ All that time and energy! And the problem with that, arguably, was that it was retrospective. It was saying, ‘We have been underpaying people for all these years. We owe them all this money.’ At some stage, governments are going to have to draw a line in the sand and say, ‘We recognise—

Mr RAMSEY —That was a silly case to put up, wasn’t it? Whoever it was—

Dr Charlesworth —No, it was probably a good idea at the time. When you put up these cases you assume that they will be settled in decent time, but in the end a number of the women originally involved were no longer in the paid workforce. You need to draw a line in the sand and say, ‘From this point on, we are going to incrementally try and improve the situation.’ The UK is currently conducting a very large inquiry into the provision and delivery of care services, and the funding arrangements are absolutely critical to that. I do not pretend to have any answers, but there needs to be a spoken commitment and then a discussion of how best to do this. Is it through phasing in? It simply has to be done. Given where women are located, particularly in those industries that you mentioned that are absolutely dependent on government funding, if we are going to do something to the aggregate pay equity gap then that is a very necessary step.

Mr RAMSEY —But you would also realise that in those kinds of decisions the political circumstances change all the time. Governments may well express a desire to do this over the longer term and then when the crunch comes around the corner these things evaporate. We see it time and time again.

Dr Charlesworth —But governments can be very persuasive. If they sell to parents whose childcare fees are raised, if it is presented in terms of increasing quality, that the quality of the particular services are actually tied to the remuneration of the paid workforce and the skilling, the responsibility and the accountability of those services for funding, then I think you start to build in a more transparent model of funding. It is not going to be perfect, and I do not for a moment—

Mr RAMSEY —But we are talking about an underpaid industry, an undervalued industry. We are not necessarily talking about something that is underskilled and inefficient. We are talking about something that is not valued.

Dr Charlesworth —No. Exactly. It can be valued by governments and members of parliament saying how important it is to value the work that is done, saying that this work is incredibly important. Talk to childcare workers. Unlike many workers in construction, they do not get dirt allowances yet they are dealing with dirt every single day. You will have heard these comparisons again and again. It really means that there has to be a stated commitment to doing it and probably a specific inquiry in much the same way that they are doing in the UK. In the UK they tend to take longer with their inquiries. I am very glad that yours is extended because I think initially I was concerned it was going to be a quick and dirty six-month one. It is really important to be taking time and looking at alternative models, and sometimes that means you have to have a look at what is happening in other countries. All developed countries in the OECD are grappling with the care crisis for both younger and older ages.

CHAIR —They are because they no longer have a ready workforce of women, frankly.

Dr Charlesworth —They no longer have women providing the informal care.

CHAIR —That is correct—in extended families, and so that is partly why it is being driven. You would also need to have quite a funding arrangement, I think. There need to be very clear requirements that this is money going to wages, because that was not done in nursing, for example.

Dr Charlesworth —That is certainly one of—

CHAIR —It went to buildings and administration.

Dr Charlesworth —Yes, and if government funding recognised wage increases in the community sector and said, ‘This money will go to wages’ then that would be a great improvement. At the moment we have had a really important recognition of the rights of vulnerable populations in Australia. We really try and provide, much to the state and the federal government’s credit, quality services for people with disabilities, quality services for aged people, but often the funding arrangements pit the interests of the client groups against the interests of the workers.

CHAIR —And the workers against the workers. We have been bombarded recently with the Because We Care campaign, which is—

Dr Charlesworth —The ASU campaign, yes.

CHAIR —ASU, ANF and other unions in aged care have pointed out that an aged-care qualified registered general nurse is receiving $300 less a week on average in an aged-care facility than a registered general nurse in a public hospital. That is a massive pay gap. But, having said that, registered general nurses are not the backbone of the workforce in aged care either. You almost have to be careful that there is not an error in funding the highly skilled mobile worker, even though I think they obviously should be paid more, when the backbone is the so-called unskilled nursing assistant or carer.

Dr Charlesworth —Gabrielle Meagher’s data also shows in that industry that you have people in the caring occupations being paid less than people in the same industry in non-caring occupations, such as administrators.

CHAIR —Any solution in this area would be gratefully received. I think you are right. I think what you are saying is that it is a specific responsibility of funding authorities in part and it is about not encouraging this almost ‘do nothing’ aspect, which is constantly moaning about what has happened in the past, and trying to set a fair benchmark now. If it is a 10 year phase—

Dr Charlesworth —Exactly—an incremental process where you are preparing those kind of impact statements. I keep advertising the British government’s approach, but for every single step they take they prepare an impact statement—’What is the impact going to be on the public purse? What is the impact going to be on private sector employers?’ That is very useful. It does mean a lot of people will be critical and of these very slow phase-ins, particularly the right to request. They have paid maternity leave but they are slowly increasing it. They have just announced greater paid paternity leave. They are doing things on an incremental basis but they have massive consultation efforts and they prepare these impact assessment statements constantly and also, luckily for people like me, provide researchers with lots of work because they are constantly evaluating.

CHAIR —But you are also, I think, identifying something that we have come to terms with, which is that pay equity is a different issue in each industry that you look at.

Dr Charlesworth —Exactly. For the solicitors in private practice that we are doing, it is hard to feel much sympathy when you are talking about someone being on only $130,000 compared to a male colleague being on $160,000 per annum. But it does depend on every single industry.

CHAIR —There might be better solutions in that area, like encouraging pay equity audits amongst the firms. I think half the firms themselves do not realise. It is same thing with our architects example. I think if you had a single architectural firm suddenly realising that it was paying different rates to the professional men and women that it employed they would want to address that. I am being generous towards the employer. I cannot imagine they would want to deliberately continue that. It seems to me that that is where you cross the boundary to becoming discriminatory as opposed to something that is a bit more about cultural perception.

Mr HAASE —It is discrimination but it is open-eyed discrimination. It is an employer saying, ‘In the next 30 years I am going to get more productivity out of this male graduate than I am out of this female graduate.’ The market values the graduates. My problem is in having an opinion that the denial of that is discrimination. The denial of that is, I think, simply ill informed. The market will determine the value of all manner of things, including employees. They are valued on the basis of productivity and return. Maybe it is ill informed and maybe those employers could be told they would have a more homogenous workforce and people would stay and they would all smile. I do not know. But presently they would look at productivity. They look at productivity over time and the value of that commodity that they are buying in all reality, whether we like it or not. I am concerned that our whole inquiry has the wrong title, because my thought is that so many people believe that, because there is equal pay for equal work regardless of gender built into the majority of awards and most people know about it, the problem is solved—

Dr Charlesworth —Yes, agreed.

Mr HAASE —and there is nothing else left to do.

Dr Charlesworth —The immunisation effect—

Mr HAASE —Yes. Therefore, is there a better term to describe the problem that we wish to solve?

Dr Charlesworth —I have thought about this a lot. I do think about the language. For example, I think the word ‘discrimination’ has probably reached its use-by date. I think people react very negatively to it. If you say to someone that they have breached an award by not returning a woman to her job, that is one thing and the employer will say, ‘Yes, I have,’ or, ‘No, I have not.’ If you say, ‘You have discriminated,’ they will say, ‘What are you saying about me?’ It is a personal affront to use that term.

With pay and equity you can talk about undervaluing because that is what it is really about. The Victorian government as part of the work and family council did some work around what people understood by ‘pay equity’. In fact, there was really poor understanding. People generally think it means the same pay for the same job—if I am sitting beside my mate who has exactly the same job title as me and he is being paid more, that is pay inequity. People do not understand equal remuneration for work of equal value.

Once again this is a big role for the government. The UK has funded massive education campaigns. For example, when they looked at graduate salaries and saw that within three years there was an average 15 per cent pay gap—and that had nothing to do with work and family at that stage; we are talking about 21- to 24-year-olds—they then funded the Equal Opportunities Commission, which is now part of the Equalities and Human Rights Commission, to run a campaign with students. They had terrific posters with an Anglo Celtic girl, an Asian girl and a black girl with ‘15 per cent off’ stamped across their heads. That was done to raise awareness amongst the students so that when they went to graduate interviews they asked about the pay. Most young women and young men assume that everything is sorted. When they go there and are told, ‘We will pay you X,’ they think that is reasonable and say, ‘I will take X.’ The male colleague, precisely because of the calculations that have been made—

Mr HAASE —I wonder if you would like to comment on—

Dr Charlesworth —I think that happens. I think those assumptions are misinformed. It depends how you measure productivity.

Mr HAASE —Mine or the assumptions of the employer architect?

Dr Charlesworth —The assumptions of the employer architect. I think your assumptions about what happens are correct, and the more frank employers will tell you that. This is really interesting because women do not go off and have babies until they are in their late 30s. At 22 they are saying she will probably go off and have babies; it is going to be a waste of time.

Mr RAMSEY —If we can legislate against that—to take the architect’s point—and say, for instance, a young female graduate let slip in her interview that to reach fulfilment in her job and her life she was expecting to have six or eight children, I think you could say that the employer would find another reason. They would find someone else entirely suitable.

Dr Charlesworth —And we have legislation against that.

CHAIR —Unfortunately, I think you are absolutely correct.

Mr RAMSEY —It would be difficult to argue with, wouldn’t it? If this person was expecting to take 10 years or 15 years out of the workforce through that period—

Dr Charlesworth —Who said they are going to take that time out of the workforce? It is highly unlikely that they are going to have seven or eight children. We have 1.75 kids on average.

Mr RAMSEY —But I do know people who do have that many children. Most of them are not in the workforce.

CHAIR —Well, not in the paid workforce!

Mr RAMSEY —I was just taking the extreme.

Dr Charlesworth —I think you raise a very interesting question. When we buy somebody’s labour for their job, are we expecting them body and soul? Or are we expecting them to put in a decent eight-hour day?

Mr RAMSEY —I am not running that argument. I am just making the point that this is the way an employee will look at things.

Dr Charlesworth —I think it is. Back when we signed the Workers with Family Responsibilities Convention the federal government engaged in a fantastic campaign to try to get across to the Australian populace about sharing the load in the household. They had our state sports minister Justin Madden when he was Carlton footballer washing up with his son at the sink. He was saying, ‘We like to give mum a night off.’ It was really powerful stuff. They had a whole lot of public figures saying that it is the Australian way and a decent thing to do to share some of the load at home. The campaign I was talking about in the UK; they require funding and they require commitment. There is always the risk then that the government will be held to account.

CHAIR —I really enjoyed that discussion and I am sorry I am going to have to bring it to an end. We will track down your submission because we would all like to have a close look at it, and if there are additional questions arising from that for you or any of the others we will certainly pursue them. Thank you very much for your attendance here today. You will be sent a copy of the transcript of your evidence to which you can make corrections of grammar or fact.

Dr Charlesworth —Thanks very much.

CHAIR —Thank you again for your time; that was great.

Mr HAASE —Thank you very much. I am sorry we could not spend more time with you and have more time for questions.

Proceedings suspended from 11.05 am to 11.17 am

CHAIR —Before we hear from our next witnesses, we now have the submission entitled Work + Family Policy Roundtable, which the committee will number 143. Is it the wish of the committee that the submission be accepted as evidence and authorised for publication? There being no objection, that is so ordered.

[11.18 am]