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‘Double dipping’ public servants will lose out twice

Public sector workers using both employer and government-sponsored paid parental leave have been accused of “double dipping”. Image sourced from

In times of fiscal austerity, governments as employers seek to curb labour costs. This is currently occurring within the Australian public service. One way of reducing costs is to limit wage rises and reduce conditions of employment through enterprise negotiations. The Australian government has suggested savings could be made through negotiating reduced sick leave. On top of this, public servants look set to lose a parental leave payment.

Media reports have suggested 80,000 employees including public servants will be worse off by $11,500 after the Government announced employees would no longer be entitled to receive parental leave pay from the Australian government, as well as PPL from their employer, should the latest proposal ever make it through parliament.

Prime Minister Tony Abbott’s original “signature” paid parental leave policy would have provided mothers with 26 weeks parental leave pay at an employee’s replacement wage.

My research, using the average salary of a public servant who works in one of the core public sector agencies in NSW (such as a government department, as opposed to those working in the wider public sector, for example, teachers or nurses), shows a female employee would have been approximately $6,000 better off under the this policy.

Under the the latest proposal employees will be $11,500 worse off - the amount which would have been paid through the universal government scheme.

Treasurer Joe Hockey has caused a furore by claiming that Australian mothers are “double dipping” on paid parental leave by utilising both employer and government sponsored parental leave.

But as Professor Marian Baird and others of the Work and Family Policy Roundtable explained, the current PPL scheme was designed to complement employer-provided PPL, taking women closer to the six months leave which the International Labour Organisation (ILO) recommends as being best for mothers and babies.

Employer-provided paid maternity leave is most common in the female-dominated industries of the public sector (81% of employees have access to paid maternity leave) and the finance sector (77%).

The major banks have long recognised the retention benefits of offering a high level of family provisions and if the current PPL proposal comes to pass, may again lead the way in offering relatively generous PPL entitlements to attract and retain female employees.

For example, the National Australia Bank has seen continued increased retention rates for female employees as a result of its PPL scheme.

But how will public servants fare? Enterprise bargaining policies in the Australian public service and half of the state and territory jurisdictions require that any wage increases be offset by productivity increases. This translates to savings being made through reduced employment conditions - such as decreasing the amount of personal carer’s leave available to employees - with any savings contributing to funding a wage rise.

In NSW at least, one main public sector union is not willing to trade off conditions for pay rises, and so it is unlikely that PPL provisions will increase for these employees.

An even more dire situation exists in the federal public sector. Not only are agencies required to trade off conditions for wage rises, but agencies are prohibited from bargaining for PPL.

This policy is based on the assumption that the Prime Minister’s Tony Abbott’s PPL policy would have been legislated. This PPL scheme would have provided women with 26 weeks paid maternity leave at replacement wages, capped at $50,000. Therefore, an increase in PPL through bargaining was seen as unnecessary.

The government’s bargaining policy is now sadly out of date and can no longer be justified. Surely an announcement rectifying this situation is imminent? Maybe. Maybe not. Enterprise bargaining negotiations in the Australian public service have been going on for over 12 months in some agencies and are becoming more fraught.

To date not a single new agreement has been made, largely due to employees refusing to approve agreements which contain reduced conditions and very low wage rises. A range of agencies are currently engaged in industrial action. The Community and Public Sector Union has denounced the government’s “hard-line” stance, but so far, the government has not appreciably changed its bargaining position.

If increased maternity leave provisions cannot be gained through public policy or collective bargaining, this leaves few avenues for improved maternity leave provisions. Australian Chamber of Commerce and Industry CEO Kate Carnell has suggested that organisations may redirect their PPL finances into providing other family provisions for employees, leaving the government to pay for PPL.

While this may be a feasible scenario for the private sector, it is unlikely in some public sector jurisdictions due to the current bargaining policies.

As the major employer of public servants, the Australian government is using its role as regulator to not only curtail increases to terms and conditions of employment, but to actively close off legitimate avenues for increases, namely, through enterprise bargaining. While there has been public outcry over the government’s perceived hypocrisy in relation to its PPL policy, there is less discussion about the government’s unilateral role as employer.

While the Australian government is committed to curtailing the costs of public sector employment, it does not appear to consider the fact that the public service is female-dominated, and PPL provisions are a critical condition of employment.

Instead, Abbott has joined Hockey in singling out federal public servants for having “two goes at the taxpayer”, thereby compounding their culpability. (Although others in the Liberal party, such former Assistant Treasurer Arthur Sinodinos told Sky News this language was “unfortunate”, while communications minister Malcolm Turnbull called for “empathy”.)

The real losers under the latest proposed PPL policy may not just be public servants, however, but the public sector’s reputation as being a family friendly employer.

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