Paid maternity leave: who should pay? As an employer I try to offer flexibility. But regulators may have another, less inviting, option.
Recently there were media reports about a 14 week funded maternity leave being introduced in Australia. There needs to be much debate about how this leave could be funded.
I’d hate to see that we end up with something like the system in France, which seems to have backfired on the women’s movement. I understand that employers there fund the two-year mandatory paid maternity leave, and now French companies discriminate against women of child bearing age – because they don’t want the potential maternity leave burden for their business.
I left corporate life when I became a Mum (well actually 12 months later, after I realised that I wanted something different for my family than a mother always in a hurry and feeling guilty).
Here are some stats that I got from the Good Weekend (14 July 2007). “Proportion of mothers in the workforce in Australia who go back to work before their baby is nine months old: 40%; six months old: 25%; three months old: 10%.”
Something does need to be done – to support people during this time when income declines and expenses go up.
I know many of the Gen-Y people who work at RedBalloon somehow equate their super payment to a “tax” – it is money they don’t see (well not for at least 30 years, and when you’re 20 that is more than a lifetime away). They definitely don’t think of the employer’s contribution as part of their salary. While having children might be some way off for them, it seems a bit closer than retirement.
I remember the thing that I wanted more than anything in that first year of being a parent was some level of tax breaks.
I wonder the potential of a system whereby people could take regular payments for 12 months from their super fund. To make this available to every woman (or parent, whoever was the primary carer) and not means tested.
This way, employers would have already made their contributions, and of course people could make their own contributions to their fund based on their own tax advice. (Has this already been invented and I don’t know about it?)
Food for thought. As an employee I wanted more flexibility when I had children more than a decade ago. As an employer I do offer part-time roles and working from home options to give some level of flexibility to parents (this works for me too, because I get highly skilled people). But for me to fund 14 weeks maternity leave for a business of our size would be impossible.
Whatever the policy makers choose, please make it something that will work for parents and employers – we want to create the clever country, you know (in more ways than one).
What do you think? What is it fair to ask employers to pay?
The founder and CEO (Chief Experiences Officer) of RedBalloon Days, Naomi is passionate about pleasure! Backed by enthusiasm, energy and drive and recently named one of Australia’s best bosses (Australia’s Marketing Employer of Choice), the Entrepreneurs Organisation (Sydney Chapter) President 200708 and mother of two, Naomi also inspires others as a regular speaker, writes a blog and has recently completed her first book.
For more Get Out of My Way blogs, click here.
Claudia from Pritchitt Partners writes: Maternity leave – or parental leave – is demanded by individuals for personal reasons, and legislated by government, and yet somehow the burden is falling on businesses. Like you, as a business owner I couldn’t afford to fund maternity leave for employees – nor for myself.
Basically, I believe the current system is discriminatory. Female entrepreneurs and sole practitioners cannot access paid maternity leave – why are they less entitled than women who work in larger organisations? If the Government wants to enforce paid maternity leave, then the Government should pay for it, and it should be available to everyone equally. After all, the Government is the one telling everyone to go out and have babies, regardless of their financial or economic situation!
I also like your idea of accessing super contributions for 12 months. I haven’t heard anyone suggest this before but I think it makes a lot of sense. It would also remove the temptation for women to ‘keep their jobs open’ for 12 months while they are on leave, when they have no real intention to return to work – a practice that I think it extremely unethical.
Linda of Journey Jottings writes: I think the idea of drawing regular payments from one’s super fund as a means of funding one’s maternity leave is a brilliant idea. Who do we go to next to get it augmented?
Pam of eurobrit.com.au writes: I could not agree more. There is so much pressure on mothers to maintain their careers, help pay all the bills, and be there for the children, run a home as well. It is all bordering on being close to impossible, especially if you do not have any support structures to help you in times of need.
I have run the race where I needed to work, to maintain my career and pay the bills, but also had to juggle bringing up two children. I am now in the position where as an employer (SME) I could not afford to paid for maternity leave, which means that although I can emphathise with mothers of young children,we are not in a position to
a) loose an employee and
b) have to pay maternity leave.
And therefore would have to think twice about employing women of child bearing age if we were to become liable for maternity costs.
This issue is a major issue, and needs to be addressed, especially considering mortgage payments that do not go away because you have had a child. I certainly will be saying to my daughter-do not rush into having children, because there is an enormous amount of pressure that comes with the job.
Linda Simonsen, managing director at FuturePeople Recruitment, writes: I couldn’t resist sharing my humble opinion on this one. It’s an emotive topic. As a female I of course support the concept of paid maternity leave for all and agree that society should support procreation not penalise it! However I can’t reconcile this with it being viable for business; particularly smaller businesses.
I own a recruitment business staffed by a team of highly talented women. Most are at the stage of their lives where they may have children in the near future and are concerned about how to balance this with work demands and career aspirations. We also have several members of the team who are working mums who job share successfully and are inspiration to the rest of us still contemplating this. As a female entrepreneur I strive to create a work environment for women that helps them reach their potential career wise and as a person.
However, staffing costs represent 70% of our total costs. With the real possibility of all members of the team being on maternity leave at the same time this would mean a doubling of wages, which would just not be sustainable financially. On face value, paid maternity leave looks like another great step forward for the women’s movement, but in reality I’m sorry to say that if it’s funded by business we could see a rise in gender discrimination and a reduction in employment opportunities for women, which is clearly a step backward.
Paid maternity leave is a great initiative and should be a women’s right however I believe this is the role of government to fund, not business. Perhaps a good way for the Government to fund this would be by directing a portion of company payroll tax contributions for female employees towards a fund, similar to superannuation. This way the funds could be invested by women for women and not disadvantage women who do not wish or are unable to have children.
Tanya at Australian FM writes: I am totally against employers paying for maternity leave. It’s all well and good paying for your good employees – what about those that are either junior, not so skilled or less important to your business. Why should employers pay for their family choices. If you can’t afford children, don’t look to your employer to fund them. Very harsh opinion, but one small business cannot be quiet about.