Oranga Tamariki social workers have reached agreement on a pay equity settlement worth $114.6 million over five years.
Minister for Children Tracey Martin says cabinet had agreed to fund the settlement reached in principle between Oranga Tamariki and the PSA.
The settlement applies to more than 1300 Oranga Tamariki social workers and would see an average lift in their salaries of 30.6 percent over a two year period, she says.
The PSA said it was an historic milestone.
Cabinet's agreement to fund the settlement was a recognition that the role of statutory social workers had been subject to historical and ongoing gender-based undervaluation, national secretary Erin Polaczuk says.
"We do want to see flow on from our equal pay achievements. It's been far too long that women's work has been undervalued."
"We have no doubt that this settlement will have an influence for social workers in other sectors and in that sense it is a true trailblazer for the undervalued profession of social work," she says.
Tracey called the deal another demonstration of the government's commitment to pay equity for all women.
"This decision recognises a historic gender-based undervaluation of Oranga Tamariki social workers, who perform vital work in keeping children and families safe."
PSA members will now vote on whether to accept the settlement and the result should be known by the end of next month.
Last week the government announced it would be introducing legislation making it easier to put in pay equity claims and setting up a framework to address pay discrimination in female-dominated jobs.