The paid parental leave divide leaving industries and new parents behind

The paid parental leave divide leaving industries and new parents behind

New data showing three in five employers now offer paid parental leave, marks a significant milestone in supporting new parents at work, particularly with most employers making such leave available to both parents.

But the research from the Workplace Gender Equality Agency’s 2020-21 census of employers with more than 100 employees, points to a great divide in who can and can’t access such leave.

First the obvious: there are still two in five employers who do not offer paid parental leave, meaning new parents will need to rely on the government minimum wage of 18 weeks for primary carers, and two weeks for secondary carers – if they’re eligible for this.

And then there is the massive industry divide in the employers who offer paid parental leave, which points to a curious outcome. Employers in male-dominated industries are far less likely to offer any form of paid primary carer’s leave (with one in two not offering it), than those employers in female-dominated industries (one in four). As a comparison, just 44 per cent of employers in manufacturing and 43% in construction are offering paid parental leave, compared with 88 per cent in education and training.

Given the amount of time, money, and effort that goes into trying to get more women into male-dominated sectors, why wouldn’t the employers in such sectors initiate this simple workplace benefit to make their workplaces more appealing to both men and women? One reason could be that male-dominated (and often still ALL-male) boards and leadership teams, tend to lead employers in male-dominated industries. Meanwhile, female-dominated industries were found by GEA to be more likely to make paid leave available to parents regardless of gender.

Another divide here is across smaller businesses of less than 100 employees, where we don’t have the comprehensive data on what’s available given these entities are not required to report to WGEA.

We do know that size makes a difference. Almost nine in ten employers are more than 5000 staff offer paid parental leave, compared to 54 per cent of employers with less than 250 staff.

Another divide is in superannuation. It’s excellent news that 81 per cent of employers offering paid parental leave are now paying superannuation to parents on leave, although just seven per cent are offering it on both employer-funded and government-funded parental leave as well. Periods of leave after having a baby are one of a number of compounding factors contributing to the gender superannuation gap later on, so this is a great step forward. But once again it raises questions about those who do not receive paid parental leave, given their employers are (presumably) unlikely to pay superannuation during their time off.

The financial outcomes – and no doubt their attachment to work and ability to take parental leave in a way that means they can return to work when have more control over how ready they are – are very different for parents who work at the six per cent of employers that offer more than 18 weeks of paid parental leave, to those that offer no leave at all.

Paid parental leave makes a difference. Not only to the new parents and their families but also in terms of loyalty back to the organisation. As WGEA Director Mary Wooldridge said on these findings, “Employers can send an unequivocal message to their staff that they are valued and important for the future, and in return, employees have increased job satisfaction, productivity and loyalty.

She also noted research finding links not only between female workforce participation but also between paid parental leave and lower infant mortality rates, increased breastfeeding rates and improved outcomes for mothers.

Here we are in the so-called “great resignation”, and yet so many employers still haven’t turned this policy switch on, one that will ultimately contribute to the health, wealth and wellbeing of families and their communities – and keep loyal staff staying with the organisation.

Key stats on paid parental leave from WGEA

  • Most common length of paid primary carer’s leave is between seven and 12 weeks (offered by 23 per cent of employers)
  • 81 per cent of employers offering paid parental leave pay superannuation to parents while on leave – with 74% paying it during employer funded leave and seven per cent paying it during both employer funded and government-funded leave.
  • Just 12 per cent of paid primary carer’s leave is being taken by men, despite it being increasingly available to both men and women. But one in five managers taking primary carer’s leave are now male, indicating a rise in such options being role modelled
  • Six per cent of employers are now offering 18 weeks of paid parental leave
  • Three in five employers are offering paid parental leave

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