Employers have an obligation to rearrange benefits if employees stand to lose out from changes to paid parental leave, a leading employer group has said, even if Joe Hockey described such arrangements as a “scam”.
Kate Carnell, chief executive of the Australian Chamber of Commerce and Industry, predicted the government would not achieve the $1bn savings booked in the budget because employers had to maintain their contributions to retain the best staff.
Carnell said while she had not heard the treasurer’s comments calling benefit rearrangements a “scam”, “the reality was employers have an obligation to do the right thing by their employees”.
“Employees will possibly lose a significant benefit as a result and therefore rearranging employer contributions would be in the best interests of the company and the staff,” said Carnell.
“The reason employers give [parental leave] is to be an employer of choice. They don’t have to [give benefits], but they need to compete for the best people and want to encourage women to work for them and to stay on in the workforce.
“From our perspective, this is simply a policy position that in the private sector won’t work – and potentially in public either – to produce the savings they want.”
On Friday morning, Joe Hockey characterised employers who change their parental leave schemes to ensure workers maintain the same level of benefits as trying to “scam” the government and the taxpayer.
The treasurer told the ABC that by changing their benefits, employers were trying to “utilise what is meant to be a safety net”. He said the government scheme was targeted at those on lower wages.
“It’s something we’ll have a look at but a good employer will offer fair-dinkum paid parental leave to their employees, like the ABC does, like the government does, like many businesses do,” Hockey said.
“And if [employers] change the scheme to try and scam the government and scam taxpayers, well, I mean that reflects on them as much as anything else.”
Carnell, who was a Liberal ACT chief minister, said she would expect that public sector employers would also change their enterprise bargaining agreements to find different “trade-offs” than paid parental leave.
“I don’t represent the public sector but I would think in the next round of EBAs, if there is an employer funded paid parental leave in the EBA for a department – and there’s lots in public sector – you might just decide to change EBA,” Carnell said.
“You would be looking for different trade-offs rather than parental leave ... Employers won’t take away that money and put in their pocket, they will utilise it to achieve outcomes to be the employer of choice.”
In the budget on Tuesday, the Coalition changed the paid parental leave policy towards relying more on employer schemes, if they are available for parents. As a result, nearly 80,000 mainly mothers will lose some or all of their commonwealth leave payments.
The Coalition’s strategy to sell the policy change in the budget has revolved around the concept that parents who access both employer and commonwealth schemes are “double dipping” – even though it is legitimate to use both schemes.
Before the budget, Joe Hockey agreed using two schemes was – in many cases – fraud and the social services minister Scott Morrison described it as a “rort”.
Bill Shorten said the attempt by the government to stop parents accessing the commonwealth scheme was a return to “the real Tony Abbott”.
“I think his support for a rolled-gold paid parental leave scheme was a tactic to say that Tony Abbott was a modern man, that he was beyond his narrow thinking, but he’s reverted to type here,” said Shorten. “So I actually think the real Tony Abbott’s emerged.”
The government rhetoric around the change in parental leave has been questioned, including by the communications minister Malcolm Turnbull and Arthur Sinodinos, both of whom have urged the government to show more empathy for young parents.
On Friday, Abbott was asked about the possibility of employers changing their parental leave schemes following the budget.
“I’m really pleased that more and more Australian businesses are offering paid parental leave and they do it because they want to attract the best possible staff and they want to keep the best possible staff, so I’m pleased that they are doing it,” Abbott said.
