The company, founded by Matt Herbert and Connor Archbold in 2021, has 51 staff across its Auckland, Sydney, London and recently added New York bases.
“When we introduced pay transparency, we quickly realised that it encouraged accountability amongst our leaders and empowered our team to have tough conversations. These benefits have combined to develop a healthy work environment where our team knows they’re valued and can openly discuss pay inequities,” van Hoffen said.
Van Hoffen said the subject of money is often treated as a highly sensitive topic in New Zealand.
“By making money talk an everyday conversation, we also hoped to make other daunting workplace chats undaunting. This has worked and discussions around extended leave, feedback and growing pains have become more common and comfortable as a result,” she said.
She said an anonymous survey showed 96 per cent of our team feel proud of working at Tracksuit and 86 per cent feel engaged by our work.
“We can rest assured knowing that pay transparency is working as intended.”
Van Hoffen highlighted some of the challenges around overcoming pre-existing mindsets around pay transparency.
“The first hurdle to overcome is the idea that your salary reflects, or determines, your worth as an individual,” she said.
“It can be uncomfortable at first knowing that everyone on the team knows what you earn because we’ve been brought up to believe that salary is linked intrinsically to our value as humans. The mindset shift comes from realising that nobody values you any more or less after they view your salary data. This allows you to decouple salary and personal worth.”
Additionally, is a mindset they call looking up, not sideways, she explained.
“Viewing company-wide salaries for the first time is pretty daunting and can definitely come with feelings of frustration or disappointment if you feel like the results you see aren’t “fair”. As long as all salaries have been benchmarked properly and any differences are fully justifiable, the mindset needs to shift to planning for the future.
“How are you going to work toward that next stage on the career framework? We’re encouraged to think about this and to have really open conversations with our managers throughout the year, not just at salary review time.”
But if you’re feeling worried your employer will start sharing your pay information with your colleagues, don’t be, says an employment lawyer.
“Under the Privacy Act, an employer is not permitted to disclose any worker’s personal information to any third party, including to another worker, unless the worker has given their individual consent to the disclosure of their personal information,” said Jennifer Mills, director of Jennifer Mills & Associates.
Mills said the Privacy Act does not preclude any employer from providing aggregated information on pay gaps or salary bands so long as no individual workers are identified or identifiable from the information.
Van Hoffen said no one at Tracksuit had requested to opt out of their salary being visible to others.
In February, Tracksuit raised $7.5 million in its first capital raising, attracting investment from Australasian venture capital firm Blackbird and local backers Icehouse Ventures.
The firm has rapidly expanded in the past six months, growing its team from 22 in February to 51 today.
It’s also tracking 1500 more brands and has brought on 150 more customers since March, van Hoffen said.
Closing the gender gap
The Labour Government announced in August that it was moving forward with plans to develop a pay gap reporting system. That system would require organisations with over 250 employees to report their gender pay gaps, and over time would apply to workplaces with over 100 employees. However, no legislation has yet been introduced, and a National win in October’s election could see this altered or shelved altogether.
National’s Workplace Relations and Safety spokesman Paul Goldsmith told the Herald: “National supports moves to assure equality and equity for girls and women in New Zealand. It was National that first introduced the Equal Pay Act and made pay gap reporting transparent in the public sector.
“We support the move to require large firms to report on their gender pay gap. Details matter for delivery, so we will look closely at the details of the proposal.”
Around 200 companies including Spark, Air New Zealand, My Food Bag, and Sharesies are either already, or committed, to voluntarily reporting their gender pay gap.
Van Hoffen said there was no gender pay gap present at Tracksuit between staff who hold the same role.
“In March 2023, we ran our first pay gap analysis and discovered a pay gap of 22 per cent. The median female salary was $98,000 and mean was $120,500. Currently, the median female salary is $130,000 and the mean is $127,469, a direct result of monitoring our pay gaps in 2023,” van Hoffen said.
Cameron Smith is an Auckland-based journalist with the Herald business team. He joined the Herald in 2015 and has covered business and sports.
