Dialogue: Paid leave a heavy price

By EDDIE MANN*

The prospect of paid parental leave is another setback for small to medium-size business in New Zealand.

Clients often say to me: "The people who dream up these things are just not aware of how small- to medium-size businesses work."

The prospect of employers having to fully or partially finance paid parental leave was bad enough and in some cases would have resulted in serious financial consequences for small-business owners.

Even without a direct financial contribution by employers, paid parental leave will have a negative impact on our employment relations, opportunities and growth.

Finding qualified people able to work in a consistent and reliable way is difficult enough. How do the advocates of this new legislation think employers will find replacement staff for up to six months?

The shortage of skilled staff is not confined to roles traditionally filled by women. Try finding a good mechanic, butcher, hairdresser or salesperson.

We have lots of people who do not have a job but few who have the skills and attitude to meet the needs of small- to medium-size business.

In a business that has five to 20 employees, the loss of experience and knowledge when a valuable employee is off work can have a serious impact on the the company. Many of my clients have female staff who effectively manage all the administrative and monthly accounts functions in their business.

It takes three to six months for a new person to become familiar with the job. Having this person away temporarily will be a serious disruption. If the employee decides to start a family then the prospect of finding a permanent replacement is less daunting than finding a temp.

In recent years there has been continued pressure on profits and prices for many companies. This has resulted in staff reductions and less resources being available to cover absences.

Most small- to medium-size businesses do not have the time or resources to train and support a temp. Even if they did, the need to pay temporary staff a considerable premium would be an additional burden.

Another concern expressed by some clients is that some employees will see 12 weeks' paid leave as just too good to be true. They will apply for parental leave knowing full well that they do not intend returning to full-time work. Once the paid period is over these employees will return to work for a few weeks and then advise their employer they are leaving.

This legislation will also disadvantage women who may be considering having a family. All things being equal, an employer who is looking for a new staff member will avoid women who may apply for parental leave in the future. I have one client who knows it is illegal to ask a prospective employee if she is planning a family.

He does it anyway because he cannot afford the luxury of temporary staff.

One woman manager said to me, "Whether I have a family or not is my concern and is nothing to do with my employer or the community as a whole. If my husband and I choose to start a family we will do it in our own way. I do not want to disadvantage my career just because I might get pregnant."

Finally, paid parental leave is another example of applying a sticking plaster. It will not solve the problem.

If the Government wants to provide an environment which encourages families, communities and business it needs to provide the foundation for a healthy economy. Adding another cost to the community will reduce opportunities and growth.

Many business owners believe paid parental leave is political fiddling used to distract us while our economy continues to burn.

* Eddie Mann is an employee relations adviser for more than 100 small to medium businesses.