Australian businesses with existing paid parental leave arrangements in place are unlikely to decrease the entitlements following the introduction of Federal Government’s new paid parental scheme, global consulting firm Mercer found.
The new government scheme allows primary caregivers for newborn or adopted children to be eligible for up to 18 weeks of paid leave at the national minimum wage of $570 a week, funded by the Federal Government. This new scheme is prompting more organisations to look at introducing paid parental leave for employees in addition to the government entitlements.
According to Mercer’s Paid Parental Leave Survey of 284 organisations, 28 percent of organisations who don’t yet have a scheme in place, almost a quarter are considering introducing employer paid parental leave in addition to the government’s entitlement with many saying they will offer to pay the difference between the government payment of $570 a week and the employee’s full pay
Seventy-two percent of organisations surveyed already offer a paid parental leave entitlement for the primary caregiver, with the median entitlement being 12 weeks at full pay.
Given the requirement to fully implement the new scheme by July, now is the time for organisations without a parental leave policy to consider their potential workforce size and demographics and assess the inclusion of parental leave into a broader total reward offering.
Tricia Sneddon, Human Capital Strategy and Talent Consulting Leader for Mercer’s Australia and New Zealand business said, “As confidence in the economy increases, companies are hiring more staff and reigniting the war for talent. A generous paid parental leave scheme can act as a key differentiator in this competitive labour environment and is a valuable tool for organisations to both attract and retain employees,” Sneddon said.
Mercer’s survey also found that some industries offer more generous reward packages than others, particularly the education and research sectors that offering 23 weeks at the median. This is nine weeks more than the next highest industries which include energy and utilities, healthcare and federal, state and local government.
