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November 13, 2009

Is your business ready for paid parental leave?

Primary carers earning less than $150,000 per year with children born or adopted after January 1 2011 will receive 18-weeks of paid leave.

Australia has long been considered backward in its attitude towards paid parental leave and is one of only two countries in the western world without it.

Treasurer Wayne Swan called the introduction of paid parental leave “a very significant reform,” but also warned, “it must be introduced in a measured and responsible way, particularly taking into account a global recession”.

Encouragingly, our recent survey showed 67 per cent of respondents were either ready or working on measures to manage new parental leave arrangements.

More than 54 per cent of readers indicated that they believed paid parental leave would increase the likelihood of women returning to their former roles. In other words, they believe paid parental leave is an important incentive in attracting and retaining women and primary carers.

However, being prepared is only part of the equation; perhaps employers should be considering how to leverage this change for the long-term benefit of their business and employees.

For instance, companies such as BHP Billiton have taken the plunge by offering paid parental leave before the due date, whilst Westpac is about to launch a series of parental support programs for its employees.

In the absence of a relevant budget, there are plenty of options for employers to embrace to position themselves as an ‘employer of choice’. Proactive SMEs are adopting broad-based programs to support their expectant parents before they go on leave.

The initiatives involve enhanced one-on-one communications before and following parental leave; developing in-house parent groups for peer support and assistance; creating flexible work-life balance arrangements and offering additional support when employees return to work.

Forward-looking employers are reaping the benefits, so where does your organisation sit on the scale? What could your organisation do to support this new direction?

Other results from the survey showed:

  • 42 per cent of respondents reported women returning to their positions following 12 months of maternity leave.
  • 57 per cent of readers said it was rare for women to return to their former role following parental leave.
  • 48 per cent of respondents said their organisations would not consider extending the 18-week pay period at their expense.
  • 42 per cent of respondents said offering good parental leave entitlements would be important in attracting quality candidates to their businesses. 


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