If you’re an employer and serious about hiring the best talent, then you must also be serious about how that great talent will fare in retirement. After all, we don’t merely work to sustain our lives now, but also to generate the savings we’ll need well in to the future,
And for many women, that future will see them retire with significant less superannuation savings than men. According to the Westpac Women & Retirement Readiness Report, released December 2013, there’s a $121,200 gap between men and women when it comes to our median super account balances. Levelling the playing field would mean women having to work until the age of 85.
So, what if employers initiated a company-wide policy of paying women more superannuation than men? This is the latest idea in our Eight Game-Changing Ideas For Women series, and one we believe could deliver a blow to the significant level of inequality facing women later on in life.
Some may claim offering more super to women could see employers preferring to hire men, given women will theoretically cost more. But it’s not like the gender pay gap between men and women working full time — currently at 18.2% — has seen Australia-wide hiring practices in favour of women, so why should a little extra super make a difference?
Others will ask how you can get past the Sex Discrimination Act on this one.
Well, that’s not impossible either. There are certain provisions in the Act that enable incentives to be applied to women over men if they address gender inequality.
Indeed, this is what consulting firm Rice Warner found when it moved to initiate its own scheme to pay female employees more superannuation than men. Once the idea was approved by the board, it approached the Human Rights Commission to get legal exemption from the Act before coming up with an incentive package for female employees that pays them 2% more super than their male colleagues, among other things.
Personally concerned by the gender gap in super savings, Rice Warner deputy CEO Melissa Fuller told Women’told Women’s Agenda earlier this year that, “I decided to look at the issue internally as I thought there must be something employers can do,” she says.
The 2% top-up Rice Warner offers is a good starting point for employers, as long as it’s also applied during periods of paid and unpaid maternity leave (as it is at Rice Warner). The firm takes additional measures to educate its staff on the gender gap while also offering women advice on additional steps they can take to increase their retirement savings.
And, according to Fuller, the men don’t even mind.
It’s not just career breaks and part time work that contribute to the superannuation gap between men and women, but also the gender pay gap and the fact women statistically live longer than men (meaning they need more).
As it currently stands, there are numerous factors against women when it comes to our retirement savings. It’s not fair to simply accept that more women than men should retire in poverty because they’ve been paid less and taken on more caring responsibilities over the course of their lives. Nor is it fair to expect that women should bear the cost of topping up their superannuation accounts alone.
A little reverse gender inequality now by employers could go a long way to achieving gender equality later on.