The pay equity taskforce that works for equal pay for women is being disestablished.
Three years ago the Labour government put in place the taskforce to help government agencies navigate the Equal Pay Act to support pay equity bargaining.
Its funding is set to run out on 30 June.
Public Service Minister Nicola Willis said the Public Service Commission was now consulting staff on the proposed disestablishment of the pay equity taskforce.
"In the past few years, a substantial number of public sector claims have been settled and the taskforce has supported agencies to build up their expertise and knowledge of their obligations," she said.
"It is a sign of success that the process for settling pay equity claims has now matured to a point where the same level of governance support and facilitation from the taskforce is no longer required."
The proposal would affect six roles.
But the nurses union said the proposal highlighted the government's "misdirected priorities".
The government appeared to be shifting its pay equity responsibilities to public sector agencies, Nurses Organisation chief executive Paul Goulter said.
"The demise of the taskforce will come with a huge loss in terms of the knowledge and skills required to ensure women do not remain the victims of sex-based wage discrimination," Goulter said.
"These skills were of huge benefit to both employers and the unions representing their employees in sorting pay equity issues."
He said the taskforce's work was yet incomplete and the government should reverse the decision.
"Instead of dismantling the mechanisms we need to achieve pay equity, we'd like to see the government actually honouring its pre-election promise to pay all nurses equally by strongly committing to establishing pay equity across the funded sector (primary / community health)."
'Gaslighting women'
There were still about 25 claims outstanding that were now at risk, Labour spokesperson for workplace relations and safety Camilla Belich said.
"I am shocked that Nicola Willis, who has benefitted from the courage and determination of women before her, is making a decision that will leave women worse off.
"Her statement is gaslighting women. The recent extra funding was to build capacity for pay equity, not to shut it down. Her argument that the taskforce has been so successful that its work is no longer needed is farcical."
Pay equity for disability care and support workers
The care and support workers' pay equity claim has been unresolved for two years.
"Today's announcement doesn't mean the government can walk away from providing the money for pay equity for care and support workers," Disability Support Network chief executive Peter Reynolds said.
"However the pay equity claim is eventually settled, the government will have to stump up with the money or watch disability support services collapse across the country. If the government refuses to fund pay equity, jobs will be lost, services will close, and disabled people and their families will lose access to support."
He feared disability support would be underfunded in the coming Budget.
Union PSA national secretary Kerry Davies said the government needed to settle the claim urgently.
"The taskforce employs experts in pay equity and has developed important frameworks to support the settlement of pay equity claims," Davies said.
"Today's news is a backwards step."
She said there it was a long way before women in New Zealand were paid what they deserved.
"We hope the finance minister (Nicola Willis) will stand by her words today and the government will not wash its hands of its responsibilities to New Zealand women but instead work with us to settle pay equity claims."