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A landmark case before the Fair Work Commission could see aged-care workers granted a 25 per cent pay increase, and force the government to reckon with the wage gap across female-dominated industries. By Kristine Ziwica.

The case that might close the wage gap

An aged-care worker puts on a mask at a facility in Melbourne.
Credit: AAP / Daniel Pockett

Josie Peacock is a 54-year-old aged-care worker who lives just outside Sydney. She has worked in the sector for almost 30 years.

“I started out in home care, then residential care,” says Peacock. “I’ve done cleaning, I’ve filled in on night shifts, I’ve done day shifts, I’ve done afternoon shifts… I’ve done whatever was required.”

Although Peacock has developed considerable expertise over her decades in the sector, including managing up to 15 staff and hundreds of volunteers, she earns just $28 an hour.

What’s more, Peacock, like many in the sector, is juggling two jobs at two different providers because she can’t get enough hours from a single provider to make ends meet.

“The only reason I’m surviving financially, to be honest, is because I’m married and my husband works full-time,” she says. “If I was on my own – on what I earn – I don’t think I could do it.”

Virginia Ellis is 55 and has worked in aged care for 15 years. Based in the Blue Mountains outside Sydney, Ellis says she regularly works 10-hour shifts. The days are long but she “loves” the job.

“In my role I do everything. From the time I walk in at eight o’clock I’m non-stop until I finish at six. Sometimes I don’t get a lunchbreak,” says Ellis.

“A lot of people I work with struggle to make ends meet or pay the rent. I see them picking up extra shifts to get by, and I often think to myself: with childcare and travelling to and fro, is it worth it? But I guess that extra little bit helps.”

“But they’re tired,” Ellis adds. “They’re exhausted.”

On $28 an hour, Ellis says her work is grossly undervalued: “It’s a very rewarding job, but it’s not respected. You hear it all the time: ‘Well, you’re just a carer.’ ”

Peacock’s experience is the same. She asks: “Why do we pay the person at Bunnings who stands at the front welcoming people – with no training, no requirement for skills – more than we pay someone – usually a woman – who’s looking after an elderly person with complex health needs, complex behaviours, and complex emotional, spiritual, and psychological needs? I can’t fathom that.”

Peacock and Ellis are not alone in expressing their frustration with the poor pay and conditions of the mostly women who work in aged care and other female-dominated caring professions, including disability care and early childhood education. The current rate of pay for a personal carer starts at $21.96 per hour.

Both women are members of the Health Services Union, which is bringing a landmark case to the Fair Work Commission seeking a 25 per cent pay rise for aged-care workers, of whom 85 per cent are women.

The unions of other female-dominated, undervalued caring sectors are watching the case with great interest. They say it is the opening salvo in a broader reckoning on the so-called “undervaluing of women’s work”: the low pay and poor conditions in highly feminised professions.

The pandemic has added an extra sense of urgency, they say, with many women in traditionally undervalued caring professions suddenly deemed “essential workers”.

Early last year, as the pandemic took hold in Australia, Leonora Risse, a lecturer in economics at RMIT University and the national chair of the Women in Economics Network of Australia, analysed Australia’s Covid-19 “front-line” workforce. Her work asked: who is keeping us healthy and alive; who is keeping us clean; who is keeping us fed, supplied and commuting; who is looking after our families; who is keeping us safe?

Risse found that while the total Covid-19 front-line workforce skewed male at 52 per cent, compared with 48 per cent female, the female-dominated sectors tended to be low paid. Sometimes scandalously low paid.

Put simply, our society just doesn’t value the work women do. Working in a female-dominated occupation can reduce pay by as much as 9 per cent.

Research has found that when women enter fields in greater numbers, pay declines for the same job that more men used to do.

Diversity Council Australia and KPMG found that this “undervaluing of women’s work” – the impact of so-called occupational segregation and industry segregation – is one of the most significant drivers of the gender pay gap, accounting for 17 per cent of it.

And since the cumulative lifetime impact of the gender pay gap undermines women’s long-term economic security – on average women retire with half the super of men and are the fastest-growing portion of the homeless population – it is also a key driver of women’s economic insecurity.

“The average superannuation component for these women in aged care is $18,000,” says Gerard Hayes, secretary of the Health Services Union. “This is what we talk about when we talk about working yourself into poverty.”

Hayes says the aged-care sector has relied on the good will of the underpaid, insecure and predominantly female workforce for far too long and that needs to change.

By bringing the historic work value case, the union is seeking an “equal remuneration order” from the Fair Work Commission. Such an order can be made by the commission where an employee is being paid less because of their gender. It ensures equal pay for work of equal or comparable value.

The Health Services Union will argue that the work of the aged-care workforce has changed over time, becoming more complex as the needs of an ageing population and community expectations of care have evolved.

“Older Australians are entering residential aged care with increasingly complex physical, social and emotional needs, in part driven by the increasing rates of dementia,” says Hayes. “The concept of care and the expectations of the community have changed, too, with the introduction of consumer-driven care within the aged-care sector.

“These have resulted in dramatic changes in the nature of work and the environment in which it is performed. However, the remuneration of this workforce has not changed beyond the increases awarded through national wage case decisions.”

The union’s application to the commission sets out an improved career structure through the introduction of the role of “specialist personal care worker” trained to work in specialist areas such as dementia and palliative care.

Peacock says there has been a shift in how workers in these fields view themselves. This has been the case not just here in Australia, but around the world, where the pandemic has driven a reckoning on the undervaluing of women’s work. Some workers now wear T-shirts that say “Essential AF”, an update on the slogan “Feminist AF”.

According to the Health Services Union, the fair work case is taking its ongoing “The Fight for 25” campaign “to the next level”. The union has organised stop-work meetings, bussed members to Canberra in anticipation of the federal budget and organised several petitions. A further indication of the campaign’s growing momentum is the 20 per cent growth in the union’s membership in the 18 months since it kicked off.

“Generally speaking, we’ve been a fairly silent working group: we don’t challenge, we don’t protest, we don’t strike, we don’t shout loudly. But that’s changing,” Peacock says. “Covid has really highlighted the issues. In the last year, more people are standing up, being vocal … They want to be part of this movement, this movement wanting change.”

 

Sara Charlesworth, a professor of work, gender and regulation at the school of management at RMIT, is an expert witness in the health union’s legal case. She says there is a disconnect between the thanks we give to essential workers in caring professions and the way we pay them. “We don’t actually treat them like essential workers, with the same respect, deference and pay that we treat paramedics, firefighters, police officers. It’s empty rhetoric.”

Danielle Wood, chief executive of the Grattan Institute, has called for a review into pay and conditions in care sectors, including how to finance higher pay. “Labour markets are not perfect, valueless measurers of supply and demand,” she says.

“There are various social norms and expectations that come into play when pay is being decided, and the lower pay in these jobs reflects the fact that we just put a lower social, and ultimately financial, value on traditionally female jobs. It’s most acute in the care sectors because it’s both a female-dominated workforce and associated with caring skills, something that women are meant to do selflessly, so you get this perfect storm of poor pay and conditions.”

The key point aged-care workers and their advocates are making is this: a little more than 50 years after equal pay for equal work became the law in Australia, there is still a significant gender pay gap of 13.4 per cent and progress has stalled. What’s more, new research from Bankwest Curtin Economics Centre and the Workplace Gender Equality Agency suggests that – without intervention – the proportion of the gender pay gap attributed to the undervaluing of women’s work will never close.

The Morrison government points to the latest gender pay gap figures and says the gap is at a “historic low”. That figure is misleading, however: the gender pay gap has only decreased because the number of men working in lower-paid, full-time employment has increased.

Put differently, men are earning less rather than women earning more. As Libby Lyons, the former director of the Workplace Gender Equality Agency, pointed out in a press release accompanying the release of the figures: “there has been no structural change to women’s overall position in the workforce”.

The government has a significant role to play in this. Unlike with other drivers of the gender pay gap, such as the burden of unpaid care work or discrimination, the government has a significant direct lever to address wages as the primary funder of most care sectors, including aged care. It could simply direct that people in these sectors be paid more – and fund the increased wages.

Charlesworth puts it like this: “The government is, effectively, the lead employer. It needs to really step up to alleviate the gender pay gap in care work by investing in a care economy, which means sustainable care jobs.”

If the Morrison government wanted to, it could put a massive dent in an issue that accounts for about a fifth of the gender pay gap. Yet it isn’t pulling that particular lever.

Although the Royal Commission into Aged Care Quality and Safety recommended the government, unions and advocacy groups work together to address the so-called “workforce issues”, a euphemism for the undervaluing of women’s work, the government’s response to the royal commission in the 2021 budget was silence on the issue.

What’s more, the  accompanying Women’s Budget Statement was also silent on the undervaluing of women’s work. While it conceded that “female-dominated industries and occupations do typically attract lower pay than male-dominated ones,” it offered no solution other than to encourage more women to go into higher-paying, male-dominated industries, or to encourage women to aim higher up the food chain with programs to support them to become “leaders” and “founders”.

At the end of the day, however, someone needs to do the caring work. As many have pointed out, this is the “work” that makes all other forms of women’s paid work possible.

 

Thus far, the Morrison government has declined to intervene in the Health Services Union case. Last week, the Fair Work Commission advised the government it had until July 23 to indicate whether it will fund the pay rise but it is yet to respond.

“You need a credible promise that they’re willing to foot that bill,” says Wood. “Certainly, they could have put provisions for that in the budget, but they didn’t.”

Why the reluctance to address the undervaluing of women’s work? The short answer is money. Back-of-envelope calculations based on a 40-hour week for aged-care workers suggests the cost of the wage increase being argued for by the union would be about $2.3 billion a year.

Although expensive, advocates argue the cost should be considered a form of post-Covid-19 stimulus and an investment in the “jobs of the future”. Care and service jobs are where most jobs growth is expected.

Modelling from the National Foundation for Australian Women confirms that government investment in the care sector would deliver a significant economic boost, similar to that of the already committed investment in male-dominated construction industries and infrastructure projects but with women the main beneficiaries.

“I just find it very hard to understand why, in this particular area where the government does have a direct lever to effect pay and conditions, it’s not doing it,” says Charlesworth.

Many in the aged-care sector and other female-dominated, undervalued caring sectors hope Jane Hume, the newly appointed minister for Women’s Economic Security, will do more to put the undervaluing of women’s work on the Morrison government’s radar.

But if Hume and her colleagues are not persuaded by the opportunity an investment in care provides to tackle a significant driver of the gender pay gap, shore up women’s economic security and boost the economy after the pandemic, Virginia Ellis has a challenge she hopes will help enlighten them as to the “value” of the work she does.

“Come along and do a buddy shift,” she says. “Because they can sit in their offices all they like, but unless they know, they’ll never believe what our job is and how hard we work.” 

This the second in a three-part series on women’s economic security, supported by the Melbourne Press Club’s Michael Gordon Fellowship for social justice journalism.

This article was first published in the print edition of The Saturday Paper on Jul 10, 2021 as "The case that might close the wage gap".

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Kristine Ziwica is a Melbourne-based journalist.