are return-to-office mandates widening the gender pay gap? a tale of two countries

As organisations around the world recalibrate their workplace strategies, return-to-office (RTO) mandates have become a defining feature of the new normal. While these policies are often framed as necessary for collaboration, productivity, or culture, emerging data suggests they may carry unintended consequences—particularly for gender pay equity.

Recent trends in the United States offer a cautionary tale. Meanwhile, Australia appears to be on a different trajectory - at least for now.

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the U.S. experience: a reversal in gender pay progress

After decades of slow but steady progress, recent census data shows the gender pay gap in the U.S. widened for the second consecutive year in 2024, marking the first back-to-back increase since the 1960s. Women earned just 81 cents for every dollar earned by men, down from 84 cents in 2022. This represents a gender pay gap increase from 16% to 19%.

This regression coincides with a surge in RTO mandates. As more companies required full-time in-office attendance and reduced flexible work options, many women - especially those with caregiving responsibilities left high-paying roles, accepted demotions, or switched industries to maintain access to remote or hybrid work.

A study of over 3 million workers found that women left their jobs at nearly three times the rate of men following the implementation of RTO policies. The impact was particularly severe for working mothers with young children, whose labour force participation dropped by nearly three percentage points in the first half of 2025.

The economic consequences are stark. Over a lifetime, career interruptions related to caregiving can cost women up to $300,000 in lost wages, promotions, and retirement savings.

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australia: a different path... for now

In contrast, Australia’s gender pay gap continues to narrow, albeit slowly. The Workplace Gender Equality Agency (WGEA) reported that the national gender pay gap fell to 11.5% in May 2024, the lowest on record. When accounting for total earnings (including bonuses and part-time work), the gap remains higher at 27.7%, but this too has been trending downward.

This progress is occurring alongside a more moderate approach to RTO mandates:

According to the Australian Human Resources Institute | Hybrid and Flexible Working Practices in Australian Workplaces in 2025 report “there has been no increase in the share of employers that are mandating their employees be in the workplace for between three and five days a week. Rather, the figures suggest that hybrid working has stabilised in many Australian workplaces (between 2022 and 2024.”

This relative flexibility may be helping to preserve gender equity gains. Flexible work arrangements are particularly important for women, who continue to shoulder a disproportionate share of caregiving responsibilities. In Australia, women still perform 65% of unpaid care work, and are more likely to work part-time or in flexible roles. [abs.gov.au]

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is the U.S. a canary in the coal mine?

The U.S. experience may serve as a warning for Australia. As RTO mandates increase, there is a risk that Australia’s progress on gender equity could stall - or even reverse.

While current trends suggest that Australia’s more flexible approach is helping to maintain equity, a growing number of major employers have introduced mandatory 5-day-a-week in office attendance. These include the likes of Amazon, Tabcorp, Dell, and Flight Centre. In August 2024, the NSW State Government mandated that public servants return to an "office-based working model," with the expectation that staff will work "principally in an approved workplace."

If flexibility becomes a privilege rather than a norm, the burden will likely fall hardest on women, particularly those balancing work with caregiving responsibilities.

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conclusion: flexibility as a gender equity strategy

The evidence is clear, flexible work is a gender equity tool. As organisations and governments shape the future of work, they must consider the broader social and economic implications of their policies.

Australia has an opportunity to learn from the U.S. By maintaining and expanding flexible work options, Australian employers can support gender equity, retain top talent, and build more inclusive, resilient workplaces.