New Zealand will see significant changes as the government takes action to address the gender pay gap.

The coalition Government is developing a voluntary calculation tool to help businesses measure and reduce the gap.

"Gender pay gaps have impacted women for decades, which is why we need to continue to drive change in New Zealand," said Acting Minister for Women Louise Upston.

Currently, New Zealand’s gender pay gap stands at 8.6 percent, remaining persistent at around 9 percent since 2018.

The government is committed to addressing the systemic barriers women face that contribute to this disparity.

Gender pay gaps are complex and can vary depending on factors such as part-time work and the inclusion of bonuses and performance pay.

To tackle this issue, the Ministry for Women will collaborate with business leaders to develop an easy-to-use approach to voluntary gender pay gap reporting.

This approach will provide all businesses with the same measurement components to calculate their pay gaps accurately.

Partnering with the business community is seen as a crucial step.

The government aims to build on existing efforts by businesses in calculating gender pay gaps, establishing a clear and consistent method for measurement.

This consistency is expected to make it easier for organisations to measure, understand, share, and take action to close their gender pay gaps.

Antonia Watson, Co-Chair of Champions for Change and CEO of ANZ, welcomed the government's initiative.

"This is a positive step forward, and we have been pleased to support the Ministry's work to date. Measurement and reporting our own gender pay gaps have been an important part of the Champions' progress, and we certainly support the initiative to make this more accessible for businesses across Aotearoa."

Louise Upston also acknowledged the efforts of Global Women and Champions for Change in scoping the calculation tool and supporting the government's development of this framework.

Champions for Change is a collective of over 80 of New Zealand’s CEOs and Chairs, aiming to accelerate inclusive and diverse leadership in their combined workforce of 170,000 people.

These organisations are already reporting their gender pay gaps and have provided early input on the initial approach for the reporting tool and framework, in collaboration with the Ministry for Women.

It is anticipated that Champions for Change and Global Women will continue to provide input and feedback over the coming months, ensuring the tool's effectiveness and usability.

By working together, the government and business leaders hope to create a more equitable workforce and drive significant change in closing the gender pay gap.

This initiative marks a critical step in addressing gender inequality in the workplace.

With a clear and consistent method for measuring pay gaps, businesses will be better equipped to understand and address the factors contributing to these disparities.