Parental leave inquiry is investigating the obvious

The Gillard Government has asked the Human Rights Commission to conduct an inquiry into workplace discrimination against employees taking parental leave. Attorney-General Mark Dreyfus claims that "there is significant anecdotal evidence that women in particular are being demoted, sacked, or having their role or hours unfavourably re-structured while on parental leave or on their return from leave". Sex Discrimination Commissioner, Elizabeth Broderick, further states that "pregnancy and return-to-work discrimination represents about 20 per cent of complaints received by the Australian Human Rights Commission".

Both of these claims ring true but should hardly come as a surprise.

Currently, under National Employment Standards, employees (including regular casuals) who have worked more than 12 months in their current job are entitled to take at least 12 month's unpaid parental leave for the birth of a child. In addition, under the Paid Parental Leave Scheme introduced in 2011, 18 weeks of government funded parental leave pay is also available at the national minimum wage. A minority of private employers (mostly large companies) provide maternity leave on full pay.

Employees taking long stretches of parental leave can cause disruptions to business, though larger organisations generally have sufficient numbers of employees to better cope with such events.

In the public sector parental leave provisions are usually more generous with around 12-16 weeks leave on full pay being the norm. Additional benefits can include generous personal (or primary care-giver) leave provisions for the care of children, access to "lactation breaks" for nursing mothers (commonly two 30 minute breaks per day), flexible working arrangements, and full recognition of paid parental leave as service.

In the case of pregnant employees, the bottom line these days is that employers in the private sector can routinely expect a minimum 18 week maternity related absence and then be legally required to reinstate the employee. Repeat bouts of parental leave may occur until the employee completes her family. Such leave needs to be viewed in the context of Australia being a country with relatively short average job tenure. Seven years is the overall average for this country, though the figure for women in the common child-bearing years is substantially shorter.

Society highly values motherhood. The problem is that policies aimed at mitigating the career costs of motherhood on working mothers are perceived by some employers as placing an unwanted burden on their businesses. The main burden is the employee absence that the employer has no control over, and this is not dissimilar to more general absenteeism. Unjustified and repeated absenteeism has traditionally been viewed as an indicator of poor individual performance and can be grounds for dismissal. Employers can and do also legitimately discriminate against those likely to take large amounts of sick leave. They regularly do so by refusing to hire those who fail a pre-employment medical examination.

In addition to the disruption caused by extended parental/maternity leave, giving birth is commonly believed to be followed by a number of years involving a higher incidence of personal leave (related to care of a young child). Some employers (rightly or wrongly) also seem to fear that a mother's proper concerns for her infant will temporarily reduce the priority she gives to work. It is not uncommon for women returning from maternity leave to seek a temporary change to part time work, which may or may not suit the employer.

The other side to the coin of course is that industrious and skilled employees are valued and commonly are difficult to replace (or replacements require costly training). Parental leave may act as an encouragement to such women to remain with their employer. An indirect effect of paid parental leave is also that (the minority of) women, who prefer to give up work to look after their babies, will now not wish to resign until 18 weeks after giving birth, in order to access the allowance.

In the public sector the financial costs of parental leave are generally higher, though this is rarely an important management consideration, and, like larger private enterprises, there may be more scope to deal with absences. In female dominated areas of the public sector such as teaching, planning for maternity leave absences can be a major issue, particularly because it is undesirable for classes to have many changes in teacher in a given year.

It is likely that conditions of service friendly to working mothers have been an important influence in feminising the public service. Even though the public sector is always publicly committed to preventing discrimination based on pregnancy, some individual managers (not always men) are believed to still seek to avoid disruptions associated with parental leave through individual acts of discrimination.

While nobody will condone breaking the law, if you were an employer choosing between hiring a visibly pregnant 26 year old woman expecting her first child and a 36 year old woman who appeared to have completed her family, and both were of apparently equal ability, who would you choose? The law suggests that you ought to be indifferent between the two.

Lets further suppose that you actually hired the pregnant 26 year old and had to put on a replacement while the 26 year old was on parental leave. How would you react if the replacement turned out to be the better worker? The law requires that the original staff member get her job back irrespective.

A further way of examining the issue is to suppose that, instead of pregnant women, it was redheads that were entitled to an 18 week bout of leave funded by the government (similar to paid parental leave) and up to a year of unpaid leave a couple of times during the their working lives (let's say at ages 26 and 28). How would we expect employers to react in terms of propensity to recruit redheads aged under 30?

Arbitrary discrimination, such as treating one group of people more favourably than another of similar ability, make no common sense in business. On the other hand, if we are asked not to discriminate in situations where such anti-discrimination appears to have a financial or organisational cost, there is an incentive not to comply. It is also probably safe to assume that, had employers rather than the Government been burdened with funding leave under the Paid Parental Leave Scheme, discrimination against employees taking parental leave would be far more widespread.

Employer discrimination against employees taking parental leave won't easily be measured. Like nepotism and other forms of discrimination it will be dressed up as something else (e.g. choosing the most qualified applicant) and buried by employers within the recruitment and firing processes.

Sex Discrimination Commissioner Elizabeth Broderick is set to oversee a national survey to assess discrimination relating to pregnancy at work and return to work after parental leave. Employers are most unlikely to admit to wilful discrimination and employee perceptions of discrimination are often exaggerated, so it is unclear how reliable the survey results will be. A section of bureaucrats (perhaps assisted by a consultancy or two) will probably undertake further research and policy development on the topic, and cost a tidy sum. This all sounds like an inquiry into the "bleeding obvious" (as well as perhaps a parting gesture by Gillard to the Sisterhood) and the money would probably be better off spent elsewhere.

Using the "anti-discrimination police" is but one option in combating discrimination against employees taking parental leave. An alternative might be to consider some form of compensation to affected employers. This of course might need to be costly to be effective.

Overall, current policy promotes a model where women are incentivised by Government to never leave the workforce, except for short bouts of paid maternity/parental leave, and this now involves substantial public expenditures to fund paid parental leave and subsidised child care. Such expenditures now involve a considerable element of middle class welfare with dual income families being major beneficiaries. Along the way traditional self-reliance on the part of comfortably well-off families seems to have gone by the wayside, and any family where the mother stays at home while her children are very young, is penalised financially.