When the Government started work to limit pay equity claims, and why the public wasn’t informed earlier
Thursday, 8 May 2025
When did the Government start work to scale back the pay equity law, and why was that work kept secret?
Using information gleaned from interviews, redacted Government documents, and debate in Parliament, political reporter Glenn McConnell has pieced together a timeline of the pay equity reform.
It took less than two days for the Government to reveal its plan to limit pay equity claims, and then change the law.
The move sparked fierce public backlash from working women, unions, and opposition parties. They criticised the law change, but also the way in which the change happened - with Parliament put into urgency to rush through a bill that had not been campaigned on ahead of the last election.
Here’s how the Equal Pay Act was changed:
NOVEMBER OR DECEMBER, 2023: Minister pitches pay equity change to Luxon
Soon after the coalition Government formed, in November 2023, Workplace Relations Minister Brooke van Velden says she pitched the idea of pay equity reform to Prime Minister Christopher Luxon.
In a letter to the prime minister, van Velden said she suggested the Government could change the Equal Pay Act to add further limitations to the criteria for making a gender discrimination claim.
Asked when she first looked into changing the Equal Pay Act, van Velden told Stuff: “This is a policy programme I told the prime minister I was interested in doing right at the start of the term.”
She said the suggestion was made in a letter to Luxon, where she outlined other priorities for the workplace relations portfolio. Those included changes to the Holiday Act, employment relations, and health and safety law changes.
DECEMBER 2023: Treasury briefing raises alarm
Finance Minister Nicola Willis says she received a briefing about the possible cost to the Government of the pay equity scheme.
“I was shocked by the size of the number, which had not been previously disclosed publicly, and which had grown very rapidly,” she told Parliament.
(The minister has not released that number, although Luxon has confirmed this change will save “billions” for the Government.)
APRIL 2024: Willis looks to limit the Government’s liability for pay equity claims
In a paper titled Pay Equity Reset, Willis suggests to Cabinet that the Government should look to limit how much it would be on the hook for when it came to these pay equity claims.
There were more than two dozen claims, almost entirely from Government-funded workforces, alleging they had been underpaid due to gender discrimination.
At this point, Willis said the Government should remain committed to the Equal Pay Act, as it stood. She said the Government should, however, look to back out of a previous commitment that it would provide funding for “funded sector employers” to boost their pay.
DECEMBER 2024: Cabinet investigates pay equity change
A committee of senior ministers, led by Luxon, met in December to consider whether to change the Equal Pay Act.
Van Velden says it was at this point that work started to amend the Equal Pay Act.
While she said she’d raised the idea with Luxon in 2023, telling him it would be a good idea “if we’ve got the resources”, she said she started working to make it happen at this Cabinet meeting.
“I didn't do work on that for a little while, not until really, when I went to Cabinet at the end of last year,” van Velden told Stuff.
But Willis has rejected the suggestion that the Government hadn’t started working to change the Equal Pay Act until December 2024.
“Well, that’s not correct. In April last year, we did take action. I took a paper to Cabinet, which is in the public domain, entitled the Pay Equity Reset,” she told Stuff.
In a normal Budget process, it’s around November and early December that ministers are asked to confirm with the Budget ministers what new spending or savings they would like to make.
The Cabinet minutes about the Equal Pay Act had been stamped as “Budget Sensitive”.
MARCH 31, 2025: Cabinet agrees to change the Equal Pay Act
After Cabinet’s Strategy Committee tasked van Velden with looking at how to amend the Equal Pay Act in December, Cabinet agreed to make changes on March 31.
Cabinet agreed at that meeting to raise the bar for what could be considered a female-dominated workforce.
In a normal Budget process, decisions tend to be locked in by March. As the Equal Pay Act amendment came in before the Budget, it was following a different process than a typical Budget initiative.
APRIL 7, 2025: Luxon releases his ‘quarterly plan’
Ahead of a post-Cabinet press conference, Luxon releases a quarterly plan. These plans, which the prime minister’s office writes every three months, had been promoted as a guide to boost transparency and display the coalition’s priorities.
But this plan makes no mention of the Government’s plan to amend the Equal Pay Act.
Asked why, van Velden told Stuff: “Because I don’t put everything I do in the quarterly plan.”
MAY 4, 2025: Government MPs told of incoming change
National Party MPs were told on Sunday night that Government would be making changes to the Equal Pay Act. Until that point, only ministers had known about the change.
Even many officials who would normally work on a proposal like this were kept in the dark. For instance, no regulatory impact statement was made to assess the lawmaking.
9.30AM, May 6, 2025: Van Velden calls press conference
In an advisory to journalists, van Velden’s office says the minister has a “major” announcement. No further details are given.
The advisory is sent after Luxon and backbench National MP Catherine Wedd hold a press conference to say they want to ban social media for children aged under 16.
11AM, May 6, 2025: Minister announces pay equity change
Arriving on the tiles at Parliament, van Velden says: “Well, I'm here to make an announcement about the Government's plans today to pass under urgency changes to the Equal Pay Act.”
She continues: “Every minister in this government has been asked to find savings… the policy changes that I'm delivering today will go some way, in quite substantial way, to find very real and significant cost reductions.”
8.20PM, May 7, 2025: Parliament locks in pay equity change
Parliament held back-to-back debates to change the Equal Pay Act on Tuesday and Wednesday, debating the bill for about 6 hours on Tuesday and then through Wednesday.
In a normal lawmaking process, it can take months to pass a bill. Usually, a select committee would hold public submissions and discuss with experts and officials if a law change is a good idea or if a bill can be improved. That did not happen for changes to the pay equity claims scheme.
So why wasn’t the public told earlier?
Willis said the Government wanted to work on this quietly so as not to spark a rush to lodge, delay or settle pay equity claims.
“We weren’t to talk about our intentions publicly due to the fact there were already claims being progressed, and due to the impact that could have both on bargaining behaviour and the initiation of new claims,” she said.
Van Velden said she “didn’t want to create a fear” that there would be multiple systems for settling pay equity disputes.
Changes to the Equal Pay Act were not a prominent feature of the 2023 election campaign, and did not feature in the coalition agreements that were published following that election.