Aequus Partners' Diversity and Flexibility e-newsletter, May 2009

Dear Colleagues

In this newsletter we profile recent initiatives and ideas to progress gender equity at work, namely (i) the introduction of paid parental leave in Australia; (ii) Australian research to benchmark progress and identify gaps; (iii) emerging interest in New Zealand in targets/quotas; (iv) opportunity for HR practitioners to trial a new skills recognition tool; and (v) public discussion with business leaders about gender equity and economic outcomes, as well as the publication of the UK Equality Bill.  The question is: will these new initiatives be enough to address the vestiges of gender inequity?

In particular we look at:

1. AUS legislation:  Paid parental leave.  In the 2009 Federal Budget the Government introduced Australia’s first Paid Parental Leave Scheme, to begin on 1 January 2011.  Primary carers of a child born or adopted will receive 18 weeks of the Federal Minimum Wage (a total of AUS $9,788) during the period of their care.  The scheme will be reviewed in 2013 to evaluate it against its objectives of increasing the average length of leave taken by employed women after childbirth, encouraging workforce participation for women and changing community attitudes towards children and taking leave from work.
2. AUS report:  She works hard for the money.  This report identifies the positive trends towards gender equality in the workplace, as well as gaps.  Of particular interest is its analysis of wealth indicators by generational groups, which includes data on division in wages, overall wealth and retirement as well as gaps in expected lifetime earnings.  The report also discusses gender differences in workforce participation trends, education trends, working hours, types of work and caring responsibilities.
3. NZ Report:  A quota challenge?  The United Nations Human Rights Council is mandated with undertaking a Universal Periodic Review of each member state in regards to their human rights position every four years.  New Zealand’s first review was held this month and Dr Judy McGregor, New Zealand’s Equal Employment Opportunities Commissioner gives us her perspective on the proceedings, in particular the urging by Norway that New Zealand begin discussions about gender quotas on the boards of public companies.
4. NZ/AUS research:  ‘Spotlight’:  A skills recognition tool.  The NZ Department of Labour and the University of NSW have researched and developed a skills recognition tool which focuses on the often unconscious “process” skills all workers use to transform separate work tasks into smooth workflow.  These skills are particularly relevant to women and other workers whose under-recognised skills are often not valued or rewarded.  The tool is currently being trialled in NZ and the researchers hope to conduct trials in Australia.
5. Notes and events.  CEDA seminar Understanding the Gender Divide – Equality in the Australian Workplace.  On 1 July in Sydney (AUS) NATSEM report author (see article 2 above in this newsletter), the Acting Director of the Equal Opportunity for Women in the Workplace Agency and our Juliet Bourke will discuss gender equity at a lunch hosted by the Committee for Economic Development in Australia.

1.  AUS legislation:  Paid parental leave

In the 2009 Budget, the Australian Federal Government introduced a Government funded Paid Parental Leave (PPL) scheme which will begin on 1 January 2011 at an estimated cost of $730.7million over five years. As this initiative represents a major policy shift for the Australian Government, this note provides details on the mechanics of the scheme.  Organisations will be able to compare their current PPL provisions against the Government scheme, and given the delayed commencement, consider whether to make enhancements.

1.1  Background

Prior to the Federal Government’s announcement (on Mothers’ Day 2009) that Australia would introduce a Government funded PPL scheme, the Australian Productivity Commission had been investigating the viability of PPL.  In its final report (May 2009) the Commission recommended that the Government introduce PPL so as to:

1. increase the average length of leave taken by employed women after childbirth by around 10 weeks so that most infants would be exclusively cared for by a parent for the first six months of life;
2. encourage increased workforce participation for women prior to having children and between pregnancies; and
3. change community attitudes by sending a signal that having a child and taking leave from work is part of the normal course of work and family life.

In the 2009 Budget (May 2009) the Government provided details of the new PPL scheme, to commence in 2011.  As noted above this gap in commencement enables best practice organisations which currently provide PPL (usually for a period less than 18 weeks) an opportunity to consider whether and how they will fill the gap between their policy and the Government’s provision.  In particular, whether they will “top-up” the Government’s payment at minimum wages to replacement level, and provide PPL to the secondary carer.

1.2  Eligibility

Under the Federal Government’s scheme, to be eligible for PPL, a person must:

• be the primary carer of a child born or adopted;
• be the mother of the newborn child or the parent of the adopted child*;
• have earned less than AUS $150,000 in the full financial year prior to the birth or adoption of a child;
• have worked at least 330 hours over the 10 months preceding the birth or adoption of a child;
• have also worked continuously with one or more employers for at least 10 of the 13 months before the expected date of birth or adoption; and
• not have worked between the date of birth or adoption and the nominated start date of Paid Leave.

* There are likely to be a number of ‘special circumstances’ in which a person who does not meet these criteria may be eligible for the Paid Parental Leave and details of this will be finalised during implementation.  (p7 ‘Australia’s Paid Parental Leave Scheme’ see below for details).

In some cases the entitlement will be able to be transferred to another caregiver if the primary caregiver returns to work before they have received their full entitlement.

The scheme will cover all employees, including casual workers, contractors and the self-employed.  It will also be available to mothers of a stillborn baby.

1.3  Payments and tax implications

Eligible parents will be provided with up to 18 weeks of leave at the Federal Minimum Wage (currently AUS$543.78 per week, a total of AUS $9788) which will, in most cases, be paid through their employer.  These payments will be treated as taxable income and will affect entitlements to existing family assistance payments, but will not be counted as income for income support payments.

People who elect not to receive paid parental leave or who do not qualify will continue to receive the Baby Bonus (currently AUS$5,000 on the birth or adoption of a child) and other family payments where they are eligible.  If a person does take the PPL they will not be eligible for the Baby Bonus (except in the case of multiple births where the Baby Bonus will not be received for the first child only) or Family Tax Benefit Part B as well as the dependent spouse, child-housekeeper and housekeeper tax offset for the 18 week period.

Parents will be able to lodge claims from 1 October 2010, so they can make leave arrangements with their employer.  The PPL payments must be taken within 12 months of the birth or adoption of a child.

1.4  Employer responsibilities

The scheme has been designed to impose minimal costs on employers.  The Family Assistance Office will ensure that employers receive the payment funds for the employee prior to their usual payroll cycle.  The employer will not be required, at this stage, to make superannuation payments for the employees receiving the payment.  Employees will not accrue entitlements whilst they are receiving the payments.

The PPL can be taken in conjunction with employer-paid leave that may be provided, such as recreation leave or paid maternity leave, as well as unpaid leave.  The employee will not be working during the time they receive their leave, however they may be in the workplace under ‘keeping in touch provisions’.  These provisions are yet to be finalised, but may include up to 10 days work during the 18 week period where the work strengthens their connection to the workplace and both the employer and employee consent to the work.

1.5  Review

The scheme will be reviewed in 2013 which will take into account emerging evaluation findings and the views of stakeholder on the future development of the scheme.  The review will consider the introduction of a paid paternity leave component and the introduction of compulsory employer-funded superannuation contributions for PPL recipients.  The scheme will be evaluated to determine its effectiveness in achieving its objectives.

For more information see ‘Australia’s Paid Parental Leave Scheme’ Commonwealth of Australia 2009
www.deewr.gov.au/Department/Publications/Documents/PPLBooklet.pdf


2.  AUS Report:  She works hard for the money.  Australian women and the gender divide

In April 2009 the (Australian) National Centre for Social and Economic Modelling (NATSEM) and AMP (an Australian financial institution) launched a report on key equality indicators for women in Australia, including employment, education, wages and lifetime earnings.  Entitled “She works hard for the money”, the report identifies positive historical trends towards equality, as well as continuing gaps.  The strength of this report is in its analysis of wealth indicators.  Innovatively, for example, AMP/NATSEM adjusted women’s wages according to generational groups (Y, X and Baby Boomers) and observed that gender disparities are almost non-existent for those in Gen Y, and minimal for Gen X.  The question is however, whether this is the shape of things to come? Will this position of parity for Gen Y women hold fast when they move into their child-rearing years (traditionally associated with a pattern of part-time work, reduced earnings and reduced superannuation savings)?

2.1  Aim

The aim of the report was to identify the current state of play with regard to the social and economic status of women in Australia as well as changes over time. Particular attention was given to women’s wealth indicators.

2.2  Method

AMP commissioned NATSEM to analyse existing Australia Bureau of Statistics (or national survey) data relevant to gender and key equity issues, eg education and employment.

2.3  Findings

AMP/NATSEM categorised findings according to five major themes, namely (i) the changing times of women; (ii) the balancing act; (iii) the employment gap; (iv) division in wages, wealth and retirement; and (v) gaps in expected lifetime earnings.

1. The changing times of women:  Overall women have invested heavily in education (indeed women are now more highly educated than men) and careers, and the related forty year trend of delaying partnering and child bearing continues.
   1. Fertility:  Although there has been an overall decline in the average number of births per woman from the 3.5 high of the 1950s, to 1.7 in 2001, more recent data shows a slight upswing to 1.9 in 2007 driven by increased government support and strong economic conditions.
   2. Median age of motherhood:  From a low of 25.6 in the 1960s, the median age of women at childbearing is now 30.8 (surmised to have arisen from a pattern of education/career first, partner later).  It is now common for women in their 40s to be first time mothers, rather than last time mothers.
   3. Education:  Overall women are more highly educated than men: they have higher school retention rates, higher University enrolment rates and are more likely to hold a post-school qualification (55% women to 53% men), particularly if they are Gen Y women (46% women to 42% men).  These educational attainments have helped increase women’s representation among most occupational groups eg managers and administrators (27.9% up from 23.8% in 1988), professionals (52.6% up from 39.7% in 1998) and associate professionals (10.3% up from 9% in 1998).
2. The balancing act:  Overall women have increased their participation in the labour market, which now stands at 58.2% (up from 48.2% in 1986).  Nevertheless there are indicators of some disparity in the “unpaid” labour market.
   1. Division of labour:  The labour gap between women and men working full-time, with dependent children is relatively narrow, ie women spend on average 78 hours per week in paid and unpaid work, compared with 74 hours for men.  The gap is more pronounced in relation to the precise type of work undertaken, ie women are more likely to undertake housework (15 hours for women per week compared with 6 hours for men) and look after children (13 hours for women and 10 hours for men), whilst men are more likely to work longer paid hours per week (48) than women (42).  The traditional gendered division of labour is even more pronounced for women working part-time, with women averaging 74 hours per week of paid and unpaid labour and men 58 hours per week.
   2. Two jobs:  Although women are less likely to be in paid employment compared with men, they are (somewhat paradoxically) more likely to be working two jobs.  AMP/NATSEM suggest this finding may be related to the likelihood that women commonly work part-time (and thus have capacity for a second job) in comparison to men who are more likely to be working full-time.  By age 55 to 64 this pattern has all but disappeared.
   3. Caring responsibilities:  Flexible working hours are the most common working arrangement used by both men (31%) and women (38%) with dependent children to provide care.  The most significant gender difference however is that men with dependents are more likely to access flexible hours, and women are more likely to work permanent part-time.
   4. Time pressures:  51% of employed women often or always felt rushed/pressed for time, compared with 39% of employed men.  Intriguingly NATSEM/AMP looked at the data by location and found that employed women living in capital cities were more rushed than men (perhaps because it is more often women racing across town to drop-off/pick-up children from school/care?), and some cities (eg Perth) were worse than others for men and women (although it is unclear why).
   5. Pregnancy, birth and work:  Women indicated that they still experienced difficulties at work in relation to their pregnancy, eg inappropriate/negative comments (9%).  Data are also included on (i) missing out on training/development opportunities (9%) and missing out on opportunity for promotion (7%), and whilst AMP/NATSEM interpret these data negatively, it is in fact unclear on the face of the data whether these missed opportunities were imposed or self-selected.  Certainly the data on identifiably negative outcomes (eg hours of work reduced without consultation) is pegged at a lower level (eg 3%).  This points to a key concern with this report, namely whether ambiguous data are being interpreted from a positive or negative framework.  A more positive framework would view that latter data point (only 3% of women report that they had hours reduced without consultation) as positive, whereas the AMP/NATSEM drew the following overall conclusion “almost one in every five women working experience at least one difficulty in their workplace in relation to being pregnant (22%)”.
3. The employment gap:  Overall (as at 2005) Australia ranked 19th in terms of the gender employment rate gap of OECD countries, lagging behind Northern European countries, the UK, Canada, the US and NZ.
   1. How are women working?:  Whilst occupational segregation continues (with men dominating trades and women dominating clerical/service work roles), women are now more likely to be employed in skilled occupations and comprised 45.5% of managerial and professional roles in 2008.  This should position women well to move into executive ranks, however trend data released by the Equal Opportunity for Women in the Workplace Agency shows that women’s representation amongst ASX 200 Boards (8.3%) and executive teams (10.7%) has declined over time (the EOWA report was profiled in our November 2008 newsletter).
   2. Average hours of work:  70% of part-time jobs are held by women which has a direct impact on earnings and accumulated wealth.  Interestingly, whilst there is an hours gap between men and women working full-time (46.7 hours to 42.7 hours per week respectively), none exists for part-time workers (ie both men and women work an average 19 hours per week).
4. Division in wages, wealth and retirement:  With changes to the Australian industrial landscape over the past ten years (and in particular a reduction in collective bargaining) recent attention has focussed on pay equity outcomes.
   1. The wage gap:  Whilst women have increased their proportion of the total share of income since the 1980s, it is still only sitting at 37%.  Better news is to be found when the data is disaggregated by generational groups, with Gen Y women receiving 85% of men’s wage, whilst Gen X women receive 62% and Baby Boomer women 64%.  But is this the real story? When AMP/NATSEM adjusted the wage gaps to take into account influencing factors (eg hours of work, number of children), women Baby Boomers still lag 13.4% behind men, but Gen X women only 3.5% and Gen Y only .6%.
   2. The wealth gap:  Whilst the average net worth of lone females and males is very similar ($387K to $374K respectively), gender disparities are evident in the way this wealth is accumulated (eg home equity (women) or superannuation (men)).  Wealth gaps are particularly evident if the females and males are also single parents ($191K to $298K respectively).
   3. Retirement:  For male and female retirees (ie aged 55+) the wealth gap is evident across all age categories but particularly younger retirees.  Women aged 55-64 have an average weekly disposable income of $306 in contrast with $507 for men.  Whilst this gap is closing for those heading for retirement (arising from stronger superannuation savings for men and women), it is still the case that men have larger superannuation balances than women (44% of men aged 55+ have $100K+, in comparison with 31% of women).
5. Gaps in expected lifetime earnings:  Taken to their logical conclusion, gender disparities in annual incomes have a magnified effect when aggregated over the life course.
   1. Average annual income:  The average annual income for men across all age brackets is higher than that of women.  This pattern holds true irrespective of whether men and women are at the beginnings of their careers (ie when aged 25 to 34 the gap is $51K to $36K respectively) or the end.  The biggest gap, not unexpectedly is between men with children and women with children (eg when aged 35-44 the gap is $64K to $33K respectively).
   2. Life time earnings:  When aggregated over the life course, the disparity between average annual incomes of working men and women becomes of more significant difference.  If the pattern for men and women aged 25 extended for 40 years men would earn $2.4 million over their lifetime in comparison with $1.5 million for women.  If they have children, the disparity will become $2.5 million for men and $1.3 million for women in lifetime earnings.

2.4  Conclusion

Apart from providing a comprehensive snapshot of gender equity in Australia, the particular value of this report is that NATSEM/AMP takes the current state of play to its natural conclusion and identifies aggregated disparities.  This is particularly valuable in relation to the analyses of gender wage gaps and lifetime earnings.  By way of critical analysis, as noted above, the report has a tendency to adopt a “cup half empty” framework to somewhat ambiguous data, however there is no denying that the failure to break the glass ceiling is a blot on the Australian employment landscape.  Hopefully this report will help stimulate new thinking about how to resolve persistent inequities.

To read the AMP/NATSEM Income and Wealth report visit  www.amp.com.au.


3.  NZ Report:  A quota challenge?

This month we (Aequus Partners) participated in high level discussions with business leaders about whether Australia should introduce gender equity quotas to finally crack the glass ceiling.  These discussions tested the appetite of companies to adopt such a blunt instrument of change, and have identified the lack of evidence supporting/rejecting the impact of quotas to enable an informed decision to be made in Australia.  It seems that something is in the air as, contemporaneously, Dr Judy McGregor (NZ) Human Rights Commission advised us that New Zealand is having similar conversations (albeit at a much more formal level) with the UN.

3.1  Introduction and background

In 2006, the United Nations General Assembly established the Human Rights Council (UNHRC) which is mandated with undertaking a Universal Periodic Review (UPR) of each Member State in regards to their human rights position.  The UPR is a significant new human rights mechanism that provides states with the opportunity to evaluate each other on the basis of objective information.  Each country will be reviewed every four years, and the first review for New Zealand was held in Geneva in May 2009.

In relation to gender equity, the New Zealand UPR submission drew on evidence from the biennial Census on Women’s Participation.  That Census report showed that the levels of female participation are not matched by levels of representation and that New Zealand continues to suffer from two key equity issues.

The first is the very low percentage of women in corporate governance.  This is evidenced by sixty companies on the NZSX Top 100 having no women on their boards and only three companies having added a woman in the past two years.  In total, women hold only 8.65% of board directorships in these companies and on this measure and in senior management positions senior female representation has fallen behind Australia and Great Britain.

The second equity issue is the systemic gender pay gap which disadvantages women, and which is significantly worse for Maori and Pacific women.  For every $1 earned by men in New Zealand today, women earn just 88 cents (12%) less.

Given these inequities, the New Zealand Human Rights Commission recommended in their UPR submission that the Government establish targets for improving the representation of women in senior management and set a minimum target of halving the pay gap by 2012 and eliminating it by 2020.

3.2  The Universal Periodic Review findings

On 7 May 2009 the Hon. Simon Power, Minister of Justice in New Zealand presented the NZ national report which outlined a range of human rights issues, including indigenous rights and inequalities, civil and political rights, child protection and education, and gender equality.  In their responses, delegations from other states commended New Zealand for its role in promoting human rights on many issues, and also made 64 recommendations for improvement.

Dr Judy McGregor, New Zealand’s Equal Employment Opportunities Commissioner attended the review and her perspective on the proceedings follow:

New Zealand has been urged at the Human Rights Council in Geneva to start discussions on introducing gender quotas on the boards of public companies.

Norway stated in the Universal Periodic Review (UPR) of New Zealand at the United Nations this month (May) that women’s under-representation in leadership and governance positions in the public and private sector needed improvement.

“The call for quotas will be a wake-up call for the 60 companies in New Zealand’s top 100 with no women on their boards”, said New Zealand’s Equal Employment Opportunities Commissioner Dr Judy McGregor who regularly publishes a benchmark Census report monitoring women’s progress

Norway was one of a number of countries at the United Nations to push women’s economic progress. Brazil recommended that the rights of New Zealand women in the labour market needed to be reinforced, regardless of age or ethnicity. Canada asked for targets to be established for improving the representation of women in senior management in the public service and for measurable targets to realise gender pay equality. Argentina wanted active policies to increases the numbers of women in local government, the judiciary and the health sector.

The New Zealand Human Rights Commission in its report on the country’s human rights progress recommended that the government establish targets for improving representation of women in senior management in the public service. It also asked for a minimum target of halving the gender pay gap of 12 per cent between men and women by 2012 and eliminating it by 2020.

“We are pleased that the new UPR process allowed other countries to comment not only on the positive progress made by New Zealand women but also on the embarrassingly low proportion of women, 8.65%, who are directors of listed companies.” States are reviewed every four years under the UPR mechanism.

3.3  Implications for other Member States

All Member States of the UN are required to submit a report and be reviewed by the other Member States.  As the first round of Universal Periodic Reviews continues, Australia will be submitting its report for a session in 2011.  Given the comments made to NZ by the Council, a discussion in Australia about the viability of gender equity targets/quotas will pre-empt an expected line of comment from the Council.

For more information on the UPR process and country reports and submissions see  www.upr-info.org.  For more information on the 2008 Women’s Census see  www.neon.org.nz/eeoissues/census2008.  For more information on the New Zealand Human Rights Commission go to  www.hrc.co.nz/.


4.  AUS/NZ Research:  ‘Spotlight’:  A skills recognition tool

The Pay and Employment Equity Unit, within the New Zealand Department of Labour, commissioned a trans-Tasman research team, involving the University of NSW, to investigate the often unconscious ‘process’ skills that enable workers to turn separate tasks into smooth, high-quality workflow. These skills are relevant in all jobs, although their detailed analysis may offer women, indigenous and culturally or linguistically diverse workers the opportunity to claim value for their often under-recognised skills.

4.1  Aim

A range of unconscious “process” skills are used by employees to transform separate tasks into a smooth, effective and high-quality flow of work.  This may be done individually or in a team.  The aim of this research was to identify these “hard-to-name” process skills and establish a framework for describing them which could then be used by practitioners in developing position descriptions and tools for recruitment, selection, performance management and career pathing.

4.2  Method

Intensive job analysis interviews were carried out based on 57 jobs which ranged from frontline, hands-on work to technical, policy and managerial roles.

4.3  Findings

Three sets of “skills of experience” each containing three elements were identified through the research:

1. shaping awareness (of contexts, self, others and impacts);
2. negotiating relationships (shaping interactions and boundaries, communicating verbally and non-verbally, and connecting across cultures); and
3. coordinating (integrating one’s own work, cooperating, and stabilising or restoring workflow).

The research explored how workers draw on their life and work experience to build these “skills of experience” through familiarisation, practice, problem-solving and solution-sharing, until they reach a level of expertise where they are helping to shape work systems.

The centrepiece of the tool is thus a framework of three skill sets, each defined at five levels of expertise (together with 150 work activity descriptors which illustrate them).

4.4  Discussion

This research provides a way of defining concepts like resilience, team-work, customer focus and leadership very precisely, by specifying the tacit skills involved.  To accompany the skills framework, the research team also developed questionnaires, checklists and guides for use in adding to position descriptions, recruitment and selection tools, and developmental approaches to performance management, workplace learning and career pathing.  The Spotlight tools are currently being trialled in the Aotearoa New Zealand Community Sector, and case studies of their use will be completed in 2009.  The Spotlight skills have wide relevance, as it is thought that they may help name the elusive qualities that make for effectiveness in any job, particularly for women whose skills are often under-recognised.

4.5  Conclusion

The researchers are currently looking for Australian organisations who would like to trial the use of the Spotlight Skills Recognition Tool.

For more information on the Tool or the trial, please contact Philippa Hall at the NZ Department of Labour philippa.hall@dol.govt.nz or Anne Junor at UNSW a.junor@unsw.edu.au.


5.  Notes and events

5.1  AUS Event:  Understanding the gender divide: equality in the Australian workplace On Wednesday 1 July, 2009 the Committee for Economic Development of Australia (CEDA) is holding a seminar on workplace equality.  Highlighting the findings from the AMP:NATSEM report discussed above, the seminar will discuss the current state of gender equality in the workplace.  The speakers include Rebecca Cassells (NATSEM), Mairi Steele (EOWA) and our Juliet Bourke. For more information on the event see  www.ceda.com.au/public/events/25478.html or to attend contact sarah.shores@ceda.com.au.

5.2  UK:  Equality Bill published.  According to the UK Government, the purpose of the Bill is to ensure everyone has a fair chance in life.  The Bill aims to promote equality, fight discrimination in all its forms, including age discrimination, and introduce transparency in the workplace, which is key to tackling the gender pay gap.  For more information, see the Trades Union Congress Changing Times News E-Bulletin at  www.tuc.org.uk.


Regards,

Juliet Bourke and Dr Graeme Russell
Partners
Aequus Partners
www.aequus.com.au

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