A standard finding in the literature on gender wage gaps is that the public sector exhibits much lower gaps than in the private sector. This finding is generally attributed to the existence of less gender discrimination in the public sector. In this paper we show that this conclusion is flawed because the standard finding for the public sector is biased by the dominating influence of large feminised occupational groups, such as those in nursing and teaching, both of which have relatively flat job hierarchies and hence low overall wage variance. However, when we examine other occupations within the public sector, there is evidence of sizeable wage gaps, much of which cannot be explained by observable or unobservable workplace or worker characteristics. This finding implies that gender discrimination is substantial in some occupations in the public sector.