Paid parental leave and flexible working paying dividends for employers

The full report from the Diversity Council Australia

We thought we'd share the DCA's findings on paid parental leave and flexible working conditions. Here's the full report.

Diversity Council Australia research reveals leading employers who provide flexible working and have good paid parental leave policies are getting returns on their investment.  

In a survey on paid parental leave and return to work provisions of DCA members, many of whom are Australia’s business diversity leaders and biggest employers, DCA found 91% of organisations had a policy to provide paid parental leave and 96% offered part-time/reduced hours. The average return to work rate from parental leave was 89%. 

Nareen Young, DCA’s CEO, said progressive employers recognise the benefits to productivity and business of paid parental leave and provision of flexible working: 

“These employers know paid parental leave and flexible working help attract and retain talented employees, especially women, and protect the significant investments they make in training and developing employees. Family-friendly practices in workplaces are crucial to reducing staff turnover and cutting the cost of having to replace experienced employees. 

“Some employers are quite innovative in their approaches such as continuing to pay superannuation while their employees are on unpaid parental leave, or making sure they remain eligible for salary reviews whilst on leave. These measures are especially important in addressing the gender pay gap for women with time spent out of the workforce having children a major contributor.   

“Several employers allow employee couples to share the one paid parental leave period or each take their own paid parental leave period, provided it isn’t taken concurrently, while other allow the parental leave periods to overlap. This reflects the realities of parenting today where parents often swap the primary carer role at different times,“ said Nareen.

Key findings of the research include:

• Paid parental leave policy – 91% of members had a policy to provide paid parental leave.
• Length of paid parental leave – 14 weeks was the average length of paid parental leave (i.e. for primary carers).
• Parental leave return rate – 89% was the average return rate for members.
• Eligibility for salary review while on parental leave – 59% of members’ policies stated that employees on parental leave were eligible for a salary review whilst on leave.
• Provision of flexible work:
• 96% offered part-time/reduced hours
• 91% flexible start and finish times (regular and ongoing, not ad hoc).
• 80% extended unpaid leave/career break
• 80% flexible work arrangements during the early weeks for settling young children into child care
• 77% telecommuting or home-based work (regular and ongoing, not ad hoc).
• 73% access annual leave in single day periods or part days
• 70% job share.

Some of the more generous and/or innovative policies adopted by employers include:

• The most generous paid parental leave was up to 52 weeks paid leave: 12 weeks leave provided at full pay and up to 40 weeks paid at 0.60 of salary for the primary carer.
• 10% of DCA members made employer superannuation contributions to employees on unpaid parental leave.
• In the case of employee couples, some organisations recognise that families want to be able to swap the primary carer role between parents at different times:
• 23% allowed parents to share the one paid parental leave period (e.g. they share the 12 weeks paid parental leave period, each taking 6 weeks leave), provided they do not take leave concurrently, and each is the primary caregiver for the time they are on leave.
• 14% allowed parents to each take their own paid parental leave period (e.g. 12 weeks paid parental leave each), provided they are the primary caregiver at that time and leave is not taken concurrently.
• 11% allowed parents to share the one paid parental leave period (e.g. they share the 12 weeks paid parental leave period, each taking 6 weeks leave) and take overlapping periods of leave.

About the research: 

DCA invited 152 member organisations to participate in an on-line survey and participants from 74 organisations responded. This represents a response rate of 49%. For a full list of DCA members, visit http://dca.org.au/membership/current-dca-members.html.