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Introduction

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Gender pay gaps affect employees across the Victorian public sector. This report shows duty holders what they can do to understand and address these gaps.

This report uses data from the 2023 workplace gender audit. It identifies trends and challenges. It gives practical actions based on evidence. The report builds on the 2021 Baseline Report. It provides updated insights to help duty holders meet their obligations under the Gender Equality Act 2020 and to close pay gaps across the sector.

The analysis shows that gender pay gaps are common. Systemic factors continue to affect pay outcomes. These factors include:

  • occupational segregation
  • industrial segregation
  • career interruptions
  • bias in recruitment and progression.

The report also shows how sector-wide change is happening. New laws, evolving policies and better reporting practices drive this change. Pay gap figures from the Workplace Gender Equality Agency show that change is possible. Nationally, the pay gap for private sector employers with over 100 employees fell from 24.2% in 2018-19 to 21.1% in 2023-24 (mean total remuneration). But there is still more to do to achieve pay equity.

We designed this report for workplace leaders, HR professionals and gender equality practitioners in organisations with duties under Victoria's Gender Equality Act 2020.

The report focuses on:

  • what the 2023 data from duty holders tells us about gender pay gaps in the sector
  • how gendered patterns in work, care, and leadership influence pay outcomes
  • what effective action looks like at the organisational level
  • how policy and law changes should inform workplace responses.

Our current data has limits. This report focuses mainly on pay differences between women and men. Not all duty holders provide data on people who self-describe their gender, so often the sample size is too small to analyse meaningfully. Where we have good data, we include findings for employees of self-described gender.

This report is designed to help organisations track progress, identify barriers, and take practical steps toward fairer workplaces. We recommend that organisations maintain mean and median total remuneration gender pay gaps well within a target range of under 5% and over −5% (WGEA 2025).

What is the gender pay gap?

The gender pay gap measures the difference in earnings between different gender groups. It’s usually expressed as a percentage or dollar figure and can be calculated in several ways. There is currently no internationally agreed method for calculating the gap.

The Commission reports gender pay gaps using both base salary and total remuneration, calculated by both the mean (average) and median:

  • Base salary: refers to an employee’s fixed annual pay, excluding bonuses, allowances, or other discretionary payments.
  • Total remuneration: includes base salary plus all additional payments, such as allowances and bonuses. These elements are often influenced by gender and provide a fuller picture of overall pay equity.
  • The mean (average) gender pay gap: is calculated by taking the difference between the average earnings of men and women, divided by the average earnings of men. This measure is sensitive to very high or very low salaries and typically results in a larger gap.
  • The median gender pay gap: is based on the middle point in each group’s earnings when sorted from highest to lowest. It is less affected by extremes.

A positive pay gap means men earn more on average than women. A negative gap indicates women earn more than men.

All figures include full-time, part-time, and casual employees, with earnings converted into full-time equivalent (FTE) amounts to ensure comparability.

Drivers of the gender pay gap

Research shows that many complex factors influence the gender pay gap. These drivers are interconnected and affect whole systems. Interconnected inequalities are measured by the Act using workplace gender equality indicators (WGEI). Key contributors include:

Workplace biases and discrimination

Social expectations about how people of different genders should behave continue to influence career choices and limit opportunities. These norms and expectations directly affect gendered work segregation (WGEI 7). They undervalue work in female-concentrated occupations and industries. They also lead to fewer women in leadership roles because of gender stereotypes about what a leader looks like and who can lead (WGEI 1) (Goldin 1990, 2021; Criado-Perez 2019; Yanadori et al. 2021; Sieghart 2022).

Gender bias and discrimination appears in many workplace practices:

  • recruitment and promotion (WGEI 5)
  • pay decisions
  • training opportunities (WGEI 5)
  • performance evaluations
  • everyday interactions, where people may be treated differently due to their gender.

Research shows this bias can:

  • limit career progression, which affects the gender composition of the workforce (WGEI 1), particularly at senior levels, and of governing bodies (WGEI 2)
  • reduce job satisfaction, including where discrimination creates workplace cultures that tolerate sexual harassment (WGEI 4)
  • widen income gaps.

For further information, see Bohnet 2018; Goldin 2021; KPMG et al. 2022; DCA 2024.

In 2020, KPMG et al. (2022:38) found that gender discrimination is the biggest driver of the pay gap, contributing 36% of the total gap.

Workforce participation, career interruptions and employment type

Women are more likely to work part-time or take career breaks because they carry more of the unpaid caring responsibilities. This limits long-term earning potential and progression into leadership roles (WGEI 1). Access to supportive flexible work and leave arrangements is vital (WGEI 6). It ensures that carers, including parents, can remain and progress in paid employment. (Goldin 1990, 2021; Miller 2018; Dangar et al. 2023; PM&C Office for Women 2023; WGEA 2024). In 2020, KPMG et al. (2022:38) found that career breaks due to caring responsibilities account for 20% of the total pay gap. Working part-time contributes 11%.

Workforce gender segregation

Certain industries remain highly gendered. Women continue to be concentrated in lower-paid roles in care, administration and services (Women's Economic Outcomes Senior Officials Working Group 2024). Men are overrepresented in higher-paid technical and leadership roles (Women's Economic Outcomes Senior Officials Working Group 2024). This reinforces the gendered division of paid and unpaid labour (Commonwealth of Australia 2023). WGEI 7 directly measures this driver.

To address these issues meaningfully, organisations must examine their workplace gender audit data, identify what drives their pay gaps, and take targeted action using their Gender Equality Action Plans. Industrial and occupational segregation are significant contributors to the total pay gap, accounting for 4% and 20% respectively in 2020 (KPMG et al. 2022:38).

The costs of the gender pay gap

Unequal pay weakens women's financial security and slows Australia's economic growth. Addressing it is both fair and economically necessary.

Wealth inequality builds up over women's entire lives. Women earn less money than men because they work fewer hours, spend more time on unpaid work like housework and childcare, and often work in feminised occupations and industries that pay less (KPMG et al. 2022). This means women have much less superannuation money saved for retirement than men do. At retirement age, Australian women have around 25% less super than men (ASFA 2023).

When women get divorced or inherit money from family, they also tend to get less than men, which makes their financial situation even worse. For example, in the farming industry, research from 2007 found that men inherit 90% of farms in Australia (Barclay et al. 2007). More recent studies also show how gendered norms continue to affect who gets to inherit farms (Voyce 2014; Sheridan et al. 2021). Traditional ideas about who can be a ‘farmer’ remain strong, and women’s work on farms is still mainly focused on household tasks and raising children (Sheridan et al. 2021).

When women have less money and wealth, it affects their freedom to make choices in their personal relationships. If a woman is in an abusive relationship, having less money can make it harder for her to leave because she might not be able to support herself financially. In 2021, it cost on average $18,000 to leave a violent relationship (Commonwealth of Australia 2021). This figure is likely to have grown due to cost-of-living pressures (Campbell 2024). Wealth inequality also stops women and gender diverse people from making free choices about their health and how they want to live their lives.

Changes to laws and policies

Recent years have brought major reforms that place economic equality and gender pay gaps on the national agenda:

In Victoria:

Updated

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