APS bonuses fall, as Katy Gallagher welcomes gender pay gap decline

The number and value of annual bonuses declined in line with a new policy introduced in August 2021, outlining expectations that they only be paid in limited circumstances, the Australian Public Service Remuneration Report 2022 found.

The annual snapshot of pay across the public sector found weighted median base salaries increased 1.7 per cent for those at APS ranks, and 4 per cent for senior executive staff. The figures were weighted to account for employee numbers at each rank.

The average gender pay gap has also declined for the fourth year in a row, reaching 5.2 per cent, compared with 6 per cent in 2021, and 7.8 per cent in 2018. It is under half the national gender pay gap of 13 per cent.

Minister for Women, Finance and the Public Service Katy Gallagher said the APS was "leading the way" on closing the gender pay gap.

"These results show that the gender pay gap isn't inevitable and that targeted action can and does drive change," she said.

The public sector's gender pay gap has been driven by a higher proportion of women at lower classifications, but since 2018, women's representation at the EL1 band and above has continued to grow.

Senator Gallagher pointed to the government's ongoing pay negotiations, and its consideration of parental leave reforms.

"As a model employer, the government is committed to continuing to drive this change through APS bargaining outcomes and parental leave reform in response to the APS Commissioner's Review of the Maternity Leave Act," she said.

The government has not yet said whether it will increase a service-wide pay offer of 10.5 per cent over three years, after the main public service union knocked it back for lacking ambition. It is expected to reveal its final offer on August 29.

It is also still considering recommendations to increase and reform parental leave, which have not been updated since 1974.

The report revealed a third of public servants (35 per cent) had received a 3 per cent wage increase under an interim pay rise arrangement between October and December 2022.

From September 1 2022, staff who were due for a pay rise before the conclusion of service-wide negotiations received the 3 per cent boost, which remains in place until August 31.

The weighted median total remuneration increase for public servants (including base salary and benefits) was 1.6 per cent for APS ranks, and 2.5 per cent for SES-level positions.

That increase for total reward (including base salary, benefits and bonuses) was 1.7 per cent for APS ranks and 2.6 per cent for SES.

The higher base salary increase of 4 per cent for senior officials was linked to factors including repackaging motor vehicle allowances into SES base salaries and general wage increases.

The report also noted a 2.3 per cent increase in the number of SES employees transferring "at level", without a recruitment round, to other agencies.

The figure climbed from 5.6 per cent in 2021 to 7.9 per cent in 2022, and "is associated with greater increases for SES employees due to a greater opportunity to negotiate a new remuneration package under individual arrangements".

A recent response to a Senate estimates question on notice from the Public Service Commission revealed agency heads had approved the direct transfer of 16 SES band 3s between June 2022 and May 2023.

The weighted base median salary increased the most (5 per cent) at the graduate level, which the report attributed to "variation in the size of the graduate cohort, differing internal reporting by agencies and differing commencement salaries between agencies".

It declined by 0.7 per cent for APS band 2 staff, which the report detailed was mostly due to a large intake of new employees in one agency, which lowered the median base salary.

The values for both groups are considered "more volatile" given their smaller populations.

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