Employers jumping the gun on paid maternity leave

29 September 2008 1:45pm

As the Government considers the Productivity Commission's proposal for paid parental leave, a growing number of large Australian employers have opted not to wait to implement their own schemes.

The draft report of the PC's paid parental leave inquiry has today recommended the Government introduce a publicly-funded entitlement to 18 weeks' paid parental leave, paid at the level of the federal minimum wage (currently $543.78) and able to be shared by both partners.

In addition, fathers and same-sex partners would be entitled to a further two weeks of "use-it-or-lose-it" paid leave, which could be taken concurrently with the paid parental leave.

To be eligible, parents would have to be a primary carer and working at least 10 hours a week with one or multiple employers for 12 months before the birth of their baby.

The entitlement would also be available to mothers of stillborn babies (where the babies meet the requirements for birth registration), adoptive parents regardless of the child's age and custodians of surrogate children.

The scheme would pay the leave to employees at the federal minimum wage of $543.78, be provided to all employees with a "reasonable attachment" to the workforce and extend to casuals, contractors and the self-employed.

Employees would receive maximum benefits of $11,854 - made up of $10,876 for 18 weeks paid parental leave and two weeks paid partner's leave, plus $979 in superannuation contributions.

Commissioner Robert Fitzgerald said that in designing the scheme, the inquiry had three main goals:

boosting child and maternal welfare;
increasing workforce participation by women; and
improving work-family balance and gender equity.

The ACTU says it is "delighted" that the PC went beyond the 14-week minimum position argued for by unions, while ACCI says business owners would be unlikely to support a model that increased red tape and required them to make superannuation contributions.

What are Australian employers already offering?

HR Daily outlines some of the parental leave schemes currently on offer by large employers below.

National retailer Myer took the lead in its sector when, in March, it introduced a six-week benefit for employees of 18 months or more.

Eligible staff can take the benefit either as a lump sum payment, as a payment in line with existing payroll cycles, or at half their normal pay rate over a 12-week period.

Myer already offered two years of unpaid parental leave - 12 months more than is required by law - and HR director Greg Travers said that it would also expand and formalise the flexible working options for returning parents.

The company has more than 10,000 permanent employees Australia-wide and 81 per cent are female. Travers said that while there is a cost involved in the initiative, "we see the benefits both in recognising our workforce and the importance of raising a family, while building the Myer brand as a preferred employer in the retail industry".

He said that the scheme would help Myer retain its staff and their knowledge in a period of skill shortages. It would also attract new staff to Myer, he said.

Shop, Distributive and Allied Employees Association national secretary Joe de Bruyn said that Myer's initiative would put pressure on David Jones to follow suit, as the two were competitors in the department store sector of the retail market.

Soon after Myer announced its scheme, grocery retailer Aldi Stores introduced its own.

It now provides 14 weeks' maternity leave on half pay to employees with 12 months' service. It will also extend its unpaid maternity leave from 12 months to 24 months.

Aldi has 3,300 permanent employees, 60 per cent of whom are female.

Aldi's group managing director Michael Kloeters said that the skills shortage made employees, particularly "long term ones", a valuable commodity.

"We invest a substantial amount of time and money in employees and don't like to lose them, so we are hoping the provision of paid maternity leave will be an attractive retention strategy," he said.

Domino's Pizza broke new ground in Australia's fast food sector in April when it announced paid maternity leave for the 200 permanent employees at its head office, as well as partner leave.

Full-time and part-time employees of 18 months are now eligible for eight weeks' paid maternity leave. This increases to 10 weeks' leave after three-to-four years' service and to 12 weeks' leave after four-to-five years' service. Eligible employees also have the option of taking leave on half pay for twice as long.

On top of this, Domino's will provide two weeks' paid leave to partners, including same-sex partners, on the birth or adoption of their child. This can be taken in either two-week blocks or single days over a six-month period.

The scheme does not apply to employees at Domino's stores and franchises, but employee relations manager Steve Klaassen said most employees there were aged between 15 and 23 years, so, "paid maternity leave might not be so important to them".

Mercy Health and Aged Care, a health, aged care and community service provider, has for some time offered paid maternity leave, maternity leave at half pay, and leave without pay, and it also has a structure to support employees who return to work while breastfeeding.

It was this year recognised as an Employer of Choice for Women by the Equal Opportunity for Women in the Workforce Agency.

MHAC chief executive officer John Ballard told HR Daily: "Since the introduction of flexible work practices… there has been an improved retention of employees and no negative impact on productivity or patient care levels."

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