Additional Comments By Senator Hanson-Young
Introduction
The Government’s Paid Parental Leave Bill 2010 seeks to
introduce into Australia the first national paid parental leave scheme, to
commence on 1 January 2011. While the Greens welcome the Government’s
commitment to introduce a fully-funded paid parental leave scheme, the way in
which the proposed legislation has been drafted continues to raise a number of
concerns.
In May 2009, the Greens introduced legislation for six
months paid parental leave plus superannuation with minimum wage. Thankfully
since this legislation was introduced, both major parties came to the table in
realising that paid parental leave is critical to providing support for
families and maintaining female participation levels in the workforce.
While both sides should receive credit for their commitment
to delivering a paid parental leave scheme, the question of how we pay for it,
and how we deliver it, is one of the most urgent policy questions currently
facing Australia.
For decades, women and men around Australia have been
calling on governments of all persuasions to legislate for paid parental
leave. And while it is often said that Australia is only one of two OECD
countries without a universal scheme of paid parental leave, we must remember
that more than 50% of American women are eligible for some form of state
government-funded paid parental leave, while more than two-thirds of Australian
working women continue to miss out.
While the Greens and indeed many of the organisations and
individuals who presented submissions to this inquiry fully support the
introduction of a national paid parental leave scheme, the fact that we have
been waiting decades for Government action on this important policy area does
not mean we should refrain from trying to improve it.
Concerns with the Bill
Right to take leave
First and foremost, it should be noted that this proposed
legislation is not a paid parental leave scheme in the true sense of the term.
While it certainly does provide an entitlement to payment at the minimum wage,
nowhere in this proposed legislation does it guarantee an eligible employee
with an entitlement to take leave, or the guarantee to get their job back at
the end of the leave period.
Despite this clear anomaly, the Minister in her second
reading speech states that the purpose of this Bill is to “support women to
maintain their connection with the workforce and boost workforce
participation.”[1]
If this were to be the case, amending the Fair Work Act to include the proposed
paid parental leave provisions alongside the unpaid parental leave provisions,
would enshrine paid parental leave as a workplace right and ensure that women,
in particular, maintain their connection with their place of employment, and
thus have an entitlement to actually take leave.
This concern was articulated by Professor Andrew Stewart
during the course of the inquiry, who said that “I
think there is no question; it is a social security entitlement. In fact it
would be better titled the ‘parental leave pay bill’ rather than ‘paid parental
leave’. That may seem a matter of semantics but I think it is fair to say that
most people in the community would understand the concept of paid leave to mean
you have a right to leave your job and come back to it.”[2]
While most parents eligible for payment under the Bill will be
entitled to take parental leave under the Fair Work Act, due to the differing
eligibility requirements between the two entitlements, there will be some women
who will be eligible for payment but not for leave. For these women they have a
choice between leaving their job to access the payment or stay in work and give
up the benefit of this Bill. It is unacceptable that some women could be forced
to make such a choice because they are eligible for the payment but do not have
an entitlement to leave.
Recommendation
No.1:
The eligibility for payment under the Bill must be
matched with an entitlement to take leave from work, preferably by an amendment
to the Fair Work Act.
Length of leave provided
There has been strong support throughout the community for
the introduction of a six month scheme. The National Foundation for Australian
Women, Save the Children, the YWCA, the Commission for Children and Young
People, the World Health Organisation, the Public Health Association, the
Australian Breastfeeding Association, Unions NSW, and the Community and Public
Sector Union, are all advocates for a six month, government-funded paid
parental leave scheme to be introduced in Australia.
When you consider that Sweden offer 47 weeks, New Zealand
offer 28 weeks, Finland offer 32 weeks, and even Spain offer 27 weeks, the fact
that Australia is still behind the eight ball on these basic supports for
working families is concerning.
Given women around Australia have been fighting for paid
parental leave to be enshrined as a workplace entitlement for decades, this
hard work must not be in vain when it comes to ensuring that the best possible
support is provided for Australian mums and dads.
Recommendation
No.2:
The Bill be amended to provide for six months paid
parental leave, reflecting the Fair Work Amendment (Paid Parental Leave)
Bill 2009 introduced by the Australian Greens in May last year.
Superannuation
Paid parental leave must be seen as a workplace entitlement,
and this includes ensuring that any payment must be treated as a wage for the
purposes of taxation, superannuation and other related laws and agreements.
The importance of recognising paid parental leave as a
workplace entitlement is essential, and would ensure that just like long
service leave or sick leave; employees would continue to accumulate
superannuation payments.
Senior Policy Manager for the Investment and Financial
Services Association told the Committee that at retirement “a typical woman will have 35 per cent less in her
superannuation account than a typical man...Women have a greater life expectancy
than men and, as a result, will need to live off their superannuation for
longer; women are paid less than men; and women are more likely to spend time
out of the workforce raising children, meaning that they are not contributing
to superannuation during this time. Research shows that a typical woman who
spends five years out of the workforce from the age of 27 will save $95,000, or
26 per cent, less than a woman who does not.”[3] So, when the Government
has a new-found commitment to strengthening superannuation, there is no excuse
for not including this entitlement in their proposed parental leave scheme.
Recommendation
No.3:
The Government’s paid parental leave must be treated as a
wage for the purposes of taxation, superannuation and other related laws and
agreements.
Existing entitlements to paid leave
A number of witnesses expressed concern that the Bill, in
its current form, does not explicitly state that the Government’s paid parental
leave payment is in addition to any existing employer funded scheme. While the
Government has indicated that this legislation should not be used to discharge
an employers existing obligation to provide paid parental leave, nowhere in
the Bill does is state that this is the intent.
In fact in Minister Macklin’s second reading speech, it is
clear that the Government envisaged that this payment would be an additional
entitlement:
“The government’s paid
parental leave can be taken in addition to existing employer funded schemes,
either at the same time or consecutively. The government’s scheme has been
designed to complement and enhance the existing family friendly arrangements
that many employers already offer.”[4]
Recommendation
No.4:
The Bill should be amended to clarify that the payment
made under the legislation is in addition to any existing obligation that an
employer may have in relation to paid parental leave.
Review of the scheme
While the Minister refers to the review mechanism in her
second reading speech stating “the Government is
committed to a review of the scheme two years after the scheme starts...Two
issues the Government has committed to look at in the review are paid paternity
leave and superannuation contributions for the period of Paid Parental Leave,”[5] nowhere in the
legislation does it require a review to take place.
Recommendation
No.5:
The legislation must be amended to specifically provide
for a review mechanism that looks into the feasibility of extending the pay
period beyond 18 weeks and including superannuation, as well as identifying the
impacts, if any, that the Parental Leave Act has had on existing entitlements
and any other related matters.
Conclusion
According to a 2009 report commissioned by the Australia
Institute, entitled Long overdue: The macroeconomic benefits of paid
parental leave, the introduction of a paid parental leave scheme in
Australia would pay for itself, stimulate the economy and create 9,000 new
jobs.
It is clear that support for parents in their efforts to
care for their newborn children is an essential component of any Government
policy that aims to promote the health and well-being of infants, and invest in
the long-term health and educational outcomes of children.
The Greens recognise that the introduction of a parental
leave scheme into Australia is indeed a historic moment, but to simply squander
this opportunity to get a scheme in place, would be to squander the legacy of
all those who have been fighting for this issue, for so long.
We owe it to those activists, and to working parents, to
produce the best legislation possible, and the Greens will be doing what we can
to ensure that this happens.
Senator Hanson-Young
Greens’ Spokesperson on the Status of Women
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