BitchBuzz: Is Shared Parental Leave Bad for Business?

After a three week break (and a column about sales bargains I didn’t post here as it was really only timely at that moment), my bi-weekly column is back. Here’s a snippet from 19th of January. The next subject I plan to write about is weaning… that should be fun in the comments thread.

Mention maternity leave and small business owners will be the first to wring their hands over costs and inconvenience. With UK law changing  in April to allow extended paternity leave, the litany of complaints is getting louder. It’s reached fever pitch with the beginning of a consultation to grant even more extensive rights. Do businesses have a point, or is this exactly what 21st century parenthood should be like?

From the 3rd of April 2011, UK fathers will be able to take 26 weeks leave at the same rate of pay as Statutory Maternity Pay (currently £124.88 a week or 90 per cent of your average weekly earnings, if that is less) between 20 weeks and one year after the birth or adoption. This is in addition to the two weeks Ordinary Paternity Leave already given. But on top of this, deputy Prime Minister Nick Clegg announced a soon-to-be launched consultation on much more flexible leave between parents– perhaps shared and split into smaller chunks, taken simultaneously or even taking in other family members – and that’s really got some businesses worried.
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Maternity leave, misunderstandings and misogyny

And, apparently, alliteration.

Yesterday I came across a Guardian CiF piece about EU maternity laws and the vote on extending minimum maternity leave to 20 weeks on full pay which yesterday got mixed backing. In the article, MEP Mary Honeyball argued that this would hit the poorest hardest, as the current system gives those less well off the chance to get a standard maternity payment and take a year off.

Except that Mary Honeyball is innacurate on at least one point and the commenters on her article are badly misinformed about others. Here are the points about the article – and its attendant comments – that troubled me.

1. There is a simple factual innacuracy – or at least a simplification (leaving out part-time workers, which might include many women who have one child already) – that slightly alters things. Honeyball says:

The maths are simple: for a woman on the minimum wage of £5.93, working for 40 hours a week, weekly pay would be £237.20 per week. If she took the full entitlement for maternity leave, she would receive £213.48 per week for the first six weeks (90% of full pay – £1,280.88) and £124.88 per week for the next 33 weeks (standard rate, regardless of earnings), which amounts to £4,121.04. She would also have the option of 13 further weeks’ maternity leave (unpaid). This is a total of £5,401.92.

However, under the proposals being voted on in the European parliament, which seek to provide 20 weeks maternity leave on full pay, a woman with the same working conditions would receive £237.20 per week for the first 20 weeks, a total of £4,744. This would be around £650 less than under the current system. Of course, part-time workers would stand to lose more.

[my emphasis]

The government’s website says:

If you qualify for SMP, it is paid:

  • for the first six weeks at 90 per cent of your average gross weekly earnings with no upper limit
  • for the remaining 33 weeks at the lower of either the standard rate of £124.88, or 90 per cent of your average gross weekly earnings

[my emphasis]

Now, in Honeyball’s example it makes little difference, as someone working full time getting over £125 a week (as, indeed, on minimum wage they should be) will qualify for the standard payment, but this does not include minimum wage part timers, which she mentions but doesn’t focus on.Yet these are likely to be among the worst off. And by saying that ‘part timers stand to lose more’, this is only the case for part-timers who qualify for the £125 payment. Many won’t, and these people will actually gain, going from 90% of their salary to 100% of their salary (and of course it’s cheaper, childcare-wise, and emotionally easier for them to go back to work earlier). But there’s a more important problem with Honeyball’s argument, which I’m coming to next.

2. ‘The maths’ don’t actually make sense.

If the EU system were put into place, the woman would go back to work at 20 weeks, thus continuing to get 100% of her salary. So instead of recieving £5,000 to see her through a year, she’d be on £12,000+. She’d never get on to that system of £125 a week, because she’d be back at work. This doesn’t mean I agree with the proposal, just that Honeyball’s argument that she’d be materially worse off isn’t true as she works it out. Honeyball doesn’t argue – as she might – that by going back to work at 20 weeks childcare costs might escalate, thus costing the woman more; she just works out the payments without considering how long those payments have to last for and therefore what they mean in real terms.

Now, I understand why Honeyball disagrees with the proposal, and why the UK government is lobbying against this becoming law here, as there are many problems with it. But it is simply false to say that the least well off will lose money. They won’t; in fact, most will gain it. What they’ll lose is something that a mother might argue is far more valuable: they’ll lose time.

Well, that’s the same as it is now. Those of us who depend on the statutory allowances will always be unable to take as much time as those who don’t; I don’t know many women who can afford to take the full year off because of the 13 weeks unpaid at the end, and if – especially in London – you’re on a minimum wage salary it’s really unlikely you’ll be able to take that £100 cut a week to take weeks on end off work. It won’t happen. You’ll either quit work and move to benefits to care for your children, or you’ll go back earlier. Those who have generous company packages from private corporations can take longer, and they likely have higher pay and more savings anyway.

So, I think that due to a combination of slightly suspicious maths and leaving the part timers (likely the least well off) out of the equation, we can see that the article misses the point quite a lot.

But the comments miss the point even more.

Here are some of my favourite pet arguments against maternity laws, generally spouted by the kind of people who, basically, don’t want anyone to have children unless they’re super rich. And who routinely discriminate women because ‘it’s going to cost them’, even though, actually, it probably isn’t very much, if at all; so maybe really because they know that it’ll always be women having to have the babies so they can use that as an excuse to treat them badly.

1. “It’s gonna cost me.”

For big business, it doesn’t cost very much at all. The costs are easy enough to absorb, and they are usually able to offer better childcare so their employees come back earlier and they lose even less.

For small businesses it’s a bit trickier, because it’s harder to do without that member of the workforce (and therefore it becomes more likely someone has to be recruited to replace the missing mother). But it’s not quite as dreadful as it sounds because many employers can actually claim back most or all of the money they pay women on maternity leave from HMRC. If you have an NI bill of less than £45,000 p.a. you get the lot, and if it’s more than that you get 92%. My heart bleeds for that 8%, it really does. Especially in those situations where you’re not required to get in full-time or as highly paid replacements for the person who’s missing.

2. “I shouldn’t have to subsidise your lifestyle choice to have children”

We ALL subsidise the lifestyle choices of others. By funding the NHS, we pay for drug addicts, people who break bits doing dangerous sports, people who smoke themselves into hideous illnesses (although frankly they’re paying more too) and many more. But more to the point, children are actually a necessity. We like to blather on about how the world is overpopulated, but pretend that this is because of people having children when it’s actually more about people living longer (but expecting to retire at the same age). And when those people get old, their contributions aren’t nearly going to cover looking after themselves. Partly because they will never contribute enough but also because the government started spending the money about 10 years before they got it. Your contributions have gone – on health care, wars, helping the least well off, the Olympics – you name it. Kids are going to be paying for you to keep going.

And that’s before you even get to forgetting innovations in health care, technology and so on, because there’ll be no-one left to do it.

Oh, and while we’re on this subject, please stop it with the Natasha Kaplinski argument already. You need to be employed for 26 weeks before the 25th week of your pregnancy to be able to get Statutory Maternity Pay. As a freelancer or a brand new contract, Five didn’t owe her a damn thing they didn’t want to pay.

3. “Don’t have kids if you can’t afford them.”

Right, well, that’s only kids for the upper middle classes and super-rich then. I look forward to David Cameron’s kids being refuse collectors (a job which is extremely important and should be far more appreciated but, let’s face it, is rarely done by people worth millions).

These tend to be the exact same commenters who complain that all kids are semi-feral these days. Which apart from being nonsense means they want parents – sorry, just women, actually – to stay at home and bring them up well, but not to afford their mums (and, crucially, dads) to have some time off to get the job started properly.

The 20 weeks full pay plan is not ideal. It still only includes two weeks for dads, and while mums and dads don’t have the option to equally split leave between them – and, importantly, take that option – women will always be treated poorly in the workplace and employers will continue to discriminate because ‘it’ll cost them’ (apparently). Until we start seeing men as additional primary caregivers, women are in trouble.

The real problem is not the possible financial loss which is practical terms doesn’t actually happen. It is, as usual, the problem of misunderstandings and, at heart, misogyny.