Pay equity settlement more than wages
A new study has found that the 2023 pay equity settlement for community and iwi social workers led to higher earnings, reduced reliance on government support, and stronger attachment to employment – providing some of the strongest evidence to date that pay equity can strengthen essential workforces and improve outcomes for workers.
The findings come amid ongoing scrutiny of New Zealand’s pay equity system following amendments to the Equal Pay Act passed under urgency in 2025. The amendments have made it significantly more difficult for workers in historically undervalued, female-dominated occupations to secure fair pay equity outcomes.
The study, Pay Equity and Worker Outcomes: Evidence from New Zealand’s Social Worker Settlement, provides rare empirical evidence on what pay equity settlements – designed to ensure equal pay for work of equal value – can achieve in practice, including effects beyond wages.
Researchers from the New Zealand Human Rights Commission and AUT's New Zealand Policy Research Institute (NZPRI) analysed linked Census and administrative data.
Among the key findings:
- Annual earnings increased by approximately $10,100 per worker (around 17%) in the year following the settlement.
- Workers’ total income increased by about $6000, after accounting for reductions in other sources, such as government income support.
- Workers were more likely to remain in employment one year later – attachment increased by 1.8 percentage points.
- Evidence of some positive effects on mental health outcomes.
“Pay equity is a fundamental human right,” says AUT Adjunct Professor Gail Pacheco, Equal Employment Opportunities Commissioner at the Human Rights Commission.
“At a time when New Zealand’s pay equity system is harder to access, our findings reinforce the importance of a strong pay equity framework to help ensure our essential workers are treated fairly, valued equally, and paid what they are worth.”
Read the study: Pay Equity and Worker Outcomes: Evidence from New Zealand’s Social Worker Settlement
This research forms part of the wider research programme Boosting productivity growth through creating equal workplace opportunities for all, funded by the Ministry of Business, Innovation and Employment Endeavour Fund.
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