National Pay Equity Coalition (NPEC)
Fact Sheet

Paid Maternity and Parental Leave?
The National Pay Equity Coalition's Proposal

Paid maternity leave has been in the news lately, due to the release of the issues paper by the Sex Discrimination Commissioner and because organisations like the Australian Catholic University and Esprit have introduced it. Discussion followed about who does and does not have paid maternity leave (in Australia and other countries), how it works in other countries, and about the benefits and problems for employers introducing it.

It's time now to consider the best way for Australia to introduce this important working condition for women. While the majority (not all) of public sector employees have paid maternity leave (generally around 12 weeks paid leave), coverage is far lower in the private sector.

NPEC proposed model for Maternity Leave

The existing maternity allowance should still be paid to women who do not leave the workforce to have a baby.

Who should pay and why?

The main options are:

The best option is funding from general taxation revenue. If employers were required to pay it is unlikely that sufficient paid leave could be won for everyone for a long time and it is likely that the funding requirement would fall most heavily on employers in female dominated industries, occupations and enterprises - which could disadvantage women in the labour market.

Collective bargaining (which already provides paid leave for some workers) could provide entitlements in excess of the taxpayer funded scheme - for longer paid leave, or higher rates of pay. However, many women have not had the industrial strength to get better conditions through enterprise bargaining. The minimum standard for everyone would be the tax-funded scheme.

Australia, New Zealand and the USA are the only three economically developed countries that do not provide paid maternity leave. In most countries, the schemes are publicly funded as part of the social security system. In Europe, much of Asia and Africa and South America, paid maternity leave is a long-established benefit.

The International Labour Organization standard is explicitly based on promoting equality of all women in the workforce and the health and safety of mother and child, and equality of opportunity and treatment for men and women workers. It sets an employment standard:

Current funding

At present, almost all the cost in foregone earnings related to childbirth is paid by the mother and her family. Foregone earnings from having a child are $239 000 for a woman with high education, $201 000 for a woman with average education and $157 000 for a women with low education. The average number of children per women is now below 1.7.

How much will it cost?

NPEC proposed model for Parental Leave

The model outlined here would also apply to adoption leave.

Benefits

The key benefits are improved retention of and opportunities for women in the paid workforce and improved welfare of mothers, babies and families. The paid leave will certainly contribute to improved peace of mind in the early months of the baby's life. Improved workforce retention promotes higher productivity for organisations and the economy generally and improved lifelong earnings prospects for women, with the associated benefits in improved retirement income.

What's Australia think?

A Newspoll in September 2001 showed 76% support for paid maternity leave. 55% strongly supported the paid leave and 21% were partly in favour. Most men support the paid leave, support was slightly stronger among women and substantially higher among younger people. Support was 69% among Coalition voters and 81% among ALP voters. Support for paid paternity leave was 59%.

While 60% said the cost of the paid leave should be shared by employers and government, while a further 17% said costs should be paid by government from taxation and 12% said costs should be paid by employers. Altogether, 77% said government has a role in funding the leave.

What you can do

Please send any comments, suggestions etc. to meg.smith@uws.edu.au

Please send endorsements from you and your organizations to Amanda Vanstone (minister.vanstone@facs.gov.au), Jenny Macklin (Jenny.Macklin.MP@aph.gov.au), Carmen Lawrence (Carmen.Lawrence.MP@aph.gov.au), Bob Brown (senator.brown@aph.gov.au), and Natasha Stott-Despoja (senator.stottdespoja@aph.gov.au) - (copy to Meg, so we can keep track of the endorsements). Ask the politicians to tell you what they will do about the issue. Letters to Parliament House Canberra 2600.

- National Pay Equity Coalition

Page created 22 May 2002; last updated 30 October 2002

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