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The Pay and Employment Equity Unit (PEE) will be disestablished as part of the reprioritising of Government spending, says Minister of Labour Kate Wilkinson.
Seven positions will be affected by the change.
"The unit has worked hard researching the causes behind New Zealand's gender pay gap and that work remains to be a valuable source of information," Ms Wilkinson says.
"But ultimately, achieving the goal of closing that pay gap can't be realised by having a singular focus on the state sector.
"This issue is the responsibility of all employers and good employers will work to tackle it.
"Disestablishing the PEE will not mean women lose their voice on employment issues. The Government continues to receive advice from other groups such as the National Advisory Council on the Employment of Women."
The Department of Labour is working to support the staff involved.
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