Source: Radio New Zealand
People rallied outside Parliament on Budget Day last year, protesting the major changes made by the coalition. RNZ/Marika Khabazi
In the early afternoon of 19 March, 2025, a small group of the country’s most powerful ministers joined an online meeting to discuss the future of 180,000 New Zealand workers.
Forty-five minutes later, they logged off having made decisions that would impact women’s earnings for years to come.
Those choices formed the backbone of the government’s overhaul of the once “world-leading” Equal Pay Act – retrospectively stripping nurses, teachers, carers and other female-dominated workforces of the right to pursue pay equity claims under the existing law.
Within five weeks of that meeting, Parliament had passed the Equal Pay Amendment Act under urgency – a move the people’s select committee last month described as “a flagrant and significant abuse of power”.
The legislation was announced then passed all stages of Parliament within three days in May, meaning the public had no opportunity to make submissions through the usual select committee process.
Dozens of in-train claims were stopped. The rules governing future claims were significantly tightened. And $12.8 billion originally earmarked to fix decades of systemic gender discrimination was instead returned to the Crown’s Budget allowances.
The changes severely curtailed the ability of workers in predominantly female industries to prove their work had been historically undervalued. In some sectors, unions said the new law may make future claims almost impossible.
NZEI Te Riu Roa, which had spent four years working on a pay equity claim covering tens of thousands of education workers, warned the new framework effectively shut down any pathway for many education roles to ever achieve pay equity.
“For teacher aides, winning our claim was huge. Women were giving up second jobs and getting to spend time with their families – that was the most amazing thing,” said teacher aide and NZEI negotiator Ally Kingi.
“But the new law cuts out every single person who is a teacher in the country from making the same claim. Primary, secondary, early childhood, te kura, principals, everyone. And teacher aides – whose pay has already slipped backwards – won’t get a review.”
NZEI negotiator Ally Kingi said when the pay equity law was overturned they were in the middle of reviewing the claim for teacher aides. “We had no idea it was all for nothing,” she said. RNZ / Eva Corlett
Documents obtained under the Official Information Act show that the most consequential decisions in the Equal Pay Act overhaul were made during that 45-minute March meeting. In several cases, ministers chose to implement harder thresholds than officials had proposed, tightening the law even further.
The government said the changes were necessary to ensure the pay equity system focused on genuine cases of sex-based discrimination and remained sustainable for taxpayers.
But the detail of how ministers reached their decisions – what evidence they relied on, what modelling informed the most restrictive changes, or why the final law was made harsher than officials recommended – remains hidden.
Despite repeated Official Information Act requests, the 19 March meeting remains, in large part, a black box.
How pay equity became law
To understand the impact of that March meeting, it helps to step back.
The Equal Pay Act was originally passed in 1972 and intended to eliminate gender-based wage discrimination – ensuring women were paid the same as men for doing the same job.
Over time, the issue shifted. The problem was no longer only women being paid less than men in identical roles. It was that work historically performed by women – caring, teaching, cleaning, administration – had been systematically undervalued compared to male-dominated occupations requiring comparable skill, effort and responsibility.
That broader concept is known as pay equity.
In 2014, the courts confirmed in the landmark TerraNova case that the Equal Pay Act allowed workers to argue their jobs had been historically undervalued because they were mainly performed by women, including by comparing their roles to those beyond the immediate workplace.
In response, a Joint Working Group – convened under a National government and including unions, business and officials – spent two years designing a process for assessing pay equity claims. Their recommendations formed the basis of the 2020 amendments to the Act.
The 2020 model created a structured process where a claim could proceed if it was “arguable” that the work in question was predominantly performed by women and may have been historically undervalued.
Once a claim passed that threshold, the parties would identify “comparators” – male-dominated occupations requiring similar levels of skill, responsibility and working conditions.
Comparators could be drawn from outside the employer or even the sector if necessary.
The low threshold was meant to allow claims to be investigated rather than filtered out early.
In 2012, aged care worker Kristine Bartlett, with her union E Tū, brought an Equal Pay Act case against her employer, Terranova Homes. The landmark case led to the introduction of the equal pay framework in 2020. E Tū Union
Cross-sector comparators were permitted because, in many female-dominated industries such as aged care, administration or early childhood education, there are simply no male-dominated roles within the same workplace to compare against.
If undervaluation was established, employers were required to negotiate pay adjustments.
By 2023, settlements had been reached for nurses, midwives, care and support workers and others. For many, the pay increases were life-changing.
“We had women who could finally afford to have their grandchildren for the holidays because they could buy food for them, women who could at last buy a lawnmower, or book a flight,” NZEI’s Kingi said. “All these women were able to live their lives, to relax. And that’s what is right and just.”
‘Significant concerns’ about cost
While the settlements were widely celebrated by workers, officials inside government were increasingly focused on their cost.
As early as November 2023, the Equal Pay Act, once described internationally as ‘world-leading’, was being framed internally not as a human rights mechanism correcting structural discrimination, but as a fiscal exposure problem.
Treasury and Ministry of Business Innovation and Employment (MBIE) briefings warned about the cost and structure of pay equity claims, including the idea the regime was “too permissive”.
In its first briefing to the incoming minister, MBIE said questions had been raised about processes for decision-making and the fiscal consequences of pay equity settlements.
Officials later argued the system provided little incentive to “negotiate hard”, pushing costs higher.
Treasury warned that pay equity costs were being treated differently from other wage pressures because of their size and uncertainty, directly affecting the Crown’s operating balance.
It expressed “significant concerns” about the comparators used in the care and support workers’ claim, suggesting they may have produced significantly higher cost outcomes.
Briefings sent to Parliament repeatedly raised the financial risks of the new pay equity framework. RNZ / Samuel Rillstone
Officials described New Zealand as “unusual” in allowing comparators from outside the workplace or sector, and questioned whether the threshold for claims was too low.
MBIE suggested other ministers may wish to discuss options to change current processes, and said it could provide further advice if required.
Pay equity specialist Amy Ross, the former head of the pay equity taskforce, said those briefings exposed what she said was a longheld, ideological view among the agencies: that pay equity was nothing but a risk to the government.
“They never thought about it for what it really was – an evidence-based market correction that had massive downstream benefits for communities – money flowing into households, services improving and the country retaining workers,” Ross said. “They only ever talked about the ‘cost’ of pay equity. But the ‘cost’ is women subsidising labour. It’s actually a cost to women.”
Enter Brooke van Velden
The agencies’ briefings clearly resonated with the new minister for workplace relations. In the first week of December 2023, Brooke van Velden, an ACT MP, sought a briefing on what she called “pay parity”.
Officials responded with a screenshot from MBIE’s website explaining that pay parity and pay equity were two different things, and both were legislated requirements in the Equal Pay Act.
Van Velden’s advisory followed up with questions wanting to know the broader “consequences” of the interaction between pay parity and pay equity.
On 29 January, 2024 van Velden wrote to Prime Minister Christopher Luxon questioning the pay equity framework and signalling her interest in reform.
At that point she was yet to have a full briefing on pay equity.
Brooke van Velden showed an immediate interest in reforming equal pay laws. RNZ / Samuel Rillstone
The letter was not released under OIA, but van Velden said she had written that she was concerned about the “robustness and reliability” of comparing remuneration between different professions in a bargaining framework, and that the pay equity bargaining system had resulted in “significant labour market distortions and high costs to the Crown”.
Critics noted the letter’s framing – painting comparators as distortive, bargaining as unreliable – echoed longstanding BusinessNZ concerns and earlier National Party proposals from 2017, which had included a tighter hierarchy of comparators and a higher threshold for claims.
In March, van Velden received her first full briefing on the issue – a MBIE PowerPoint presentation titled “Pay equity: a short history”.
This briefing was highly critical of the system, pointing to the 2020 amendments by the previous government as the problem. It also framed New Zealand as an international “outlier” for allowing cross-sector comparators; and casted doubt on the validity of current claims, particularly the low threshold for entry to the system; and the way comparators were chosen.
In response to follow-up questions about the comparators from van Velden’s advisor, officials noted anecdotal examples of fisheries officers, corrections officers and customs officers being used repeatedly as benchmarks.
These anecdotes that would later become central National and Act Party talking points after the pay equity reform was announced, were held up as an example of a “wasteful” system that had gone too far.
Fuel on the fire
If ideology lit the fire for reform, the fiscal implications provided the fuel.
Soon after the 2023 election, Finance Minister Nicola Willis also began receiving detailed briefings from Treasury, focused on the scale of potential pay equity liabilities.
The largest claims, particularly teachers and care and support workers, were expected to cost the government – as employer – billions of dollars, Treasury said.
Officials assumed pay increases of roughly 20 percent based on earlier settlements.
Throughout 2024, Willis sought increasingly detailed information about the potential fiscal exposure: how much funding had been set aside, how claims might evolve and how New Zealand’s system compared internationally.
Treasury estimated that $3.193 billion from the public-sector pay equity contingency alone could be returned to Budget allowances if the system was changed.
Across the public and funded sectors combined, as much as $12.8 billion could be freed up, significantly boosting the government’s books.
Internal documents show Finance Minister Nicola Willis showed an increasing interest in the money set aside for pay equity throughout 2024. RNZ / Samuel Rillstone
By the end of 2024, Willis had made the case to Cabinet that changes were needed. Cabinet’s Strategy Committee then directed officials from MBIE, Treasury, the Public Service Commission and Crown Law to develop options.
In late February 2025, ministers were presented with several approaches – ranging from pausing the system to redesigning it entirely.
But a full redesign was expected to take more than a year. Instead, ministers chose speed.
By 4 March, officials had been directed to prepare amendments for Cabinet approval by the end of the month, just in time for Budget 2025.
A draft Cabinet paper was circulated on 14 March. Five days later, ministers met to finalise the policy settings.
19 March
Attendance records show six ministers and a group of senior officials joined the 2pm online meeting on 19 March.
Those invited included Workplace Relations Minister Brooke van Velden, Finance Minister Nicola Willis, Public Service Minister Judith Collins, Health Minister Simeon Brown and Women’s Minister Nicola Grigg. Education Minister Erica Stanford was overseas but sent a staff member.
Officials attending included MBIE chief executive Carolyn Tremain and deputy secretary Nic Blakeley, Treasury Secretary Iain Rennie and official Struan Little, Public Service Commissioner Sir Brian Roche, associate commissioner Arati Waldgrave and Department of Prime Minister and Cabinet (DPMC) chief executive Ben King.
Together they reviewed the policy options outlined in the draft Cabinet paper.
That draft already proposed significantly tightening the pay equity regime – including raising the threshold for work to qualify as “predominantly female” from 60 percent to 66 percent, introducing a stricter hierarchy of comparators, and limiting the re-raising of claims.
But during the meeting ministers chose to go further.
They lifted the threshold to 70 percent. They also initially discussed a 20-year ban on workers re-raising settled claims, a figure eventually changed to 10 years in the final Bill. And they removed the final tier of cross-sector comparators entirely – meaning workers must now find comparisons within their own sector.
Officials noted the risk that some workforces might not be able to identify an appropriate comparator at all. The change was left anyway.
At the same time, ministers killed all 33 existing claims mid-process, some of which had been in progress for years. Those claims collectively covered around 180,000 workers across sectors including education, health, social services and the public sector.
Health Minister Simeon Brown and Public Service Minister Judith Collins were among the group of ministers at the pivotal 19 March meeting. RNZ / Dom Thomas
Pay equity specialist Amy Ross said the changes went further than any framework previously proposed.
“If you cut off cross-sector comparators, you’re effectively comparing historically underpaid work with other historically underpaid work,” she said. “You embed undervaluation.”
By raising the threshold of “predominantly female” from 66 to 70 percent, the government effectively legislated several professions out of contention including librarians, probation officers and – the largest group – teachers, which have a 68 percent female workforce.
NZEI believes that was deliberate. “Why else would you pick that number? I can’t see any other reason for that shifting and they can’t provide any other reason as to why it’s 70 percent,” said Kingi.
Marilyn Waring, the chair of the People’s Select Committee which investigated the change, agreed.
“They would have known the exact percentage at which they lost another claimant group,” Waring said. “I think they were greedy. Those ministers just had dollar signs in their eyes.”
Taken together, the changes fundamentally reshaped how pay equity claims could be brought in New Zealand.
A black box
Documents show what happened immediately after the meeting. Within hours, officials were rewriting the Cabinet paper to “better reflect the Minister’s feedback overnight” and scrambling to gather examples to support the changes.
Emails marked “SENSITIVE” show agencies being asked urgently to confirm that they were comfortable with claims that comparators such as fisheries or corrections officers had been used inappropriately, and to provide examples of “broadly scoped claims” and review clauses that went beyond sex-based undervaluation.
The DPMC’s Policy Advisory Group was heavily involved in the process, and the Prime Minister was briefed repeatedly on progress.
A DPMC official who attended the meeting wrote to MBIE afterwards saying ministers had been “universally impressed” with the “clear answers and direction” provided by officials.
Officials reporting to Prime Minister Christopher Luxon were also in the 19 March meeting, and involved in the new law’s drafting process. RNZ / Samuel Rillstone
Yet, when RNZ filed Official Information Act requests for the records of the discussion, the paper trail was limited.
Treasury, the Public Service Commission, and the offices of Willis, Brown, and Grigg all claimed they had no contemporaneous minutes, records or notes. Collins and Stanford’s offices refused to release their records. MBIE confirmed an official took handwritten notes but also refused to release them under the Official Information Act’s “free and frank” provision.
Requests for modelling underpinning key decisions – including raising the threshold to 70 percent – produced nothing. RNZ has been unable to confirm if this information exists and is being withheld, or if no such modelling of the far-reaching, late change was considered by ministers before making their decision.
Officials have already acknowledged no Regulatory Impact Statement was prepared for the reforms. The policy was developed within a “severely compressed timeframe”, with limited opportunity to assess evidence or test assumptions, MBIE said.
A spokesman for Willis said the absence of detailed minutes from the meeting was “not unusual for meetings where decisions are recorded via papers”. The papers prepared for the meeting and capturing the decisions taken at it were released and are publicly available online.
In its report released this month, the People’s Select Committee was scathing of the policy development process. As part of its investigation it examined what little material was made public, and found it severely lacking. “No minister was ever fully briefed on the measure’s human rights consequences,” the report said.
“Every piece of information is bite-sized, simplistic and undeveloped – a slide show. No one is ever required to read anything meaningful or comprehensive.”
The committee said the process left serious questions about how ministers were able to assess the impact of the reforms before the law was passed.
“My belief is they don’t want the information to be public because they know they don’t have a leg to stand on because their analysis was so poor,” Waring told RNZ this week. “But of course we should be able to see the evidence.”
A group of unions is taking a High Court case to argue the law change breached the Bill of Rights Act, which Waring believed would flush out further information on the process.
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– Published by EveningReport.nz and AsiaPacificReport.nz, see: MIL OSI in partnership with Radio New Zealand
