To entice more parents into the workforce, address labour market concerns and reflect modern family and work requirements, the Federal Government confirmed plans to scale up the paid parental leave scheme in the October Budget.
The new scheme introduces a staggered increase in leave from 18 to 26 weeks over three years from 2023. Two additional weeks of leave will be available from July 2024 and leave entitlement will continue to increase by two weeks each year until July 2026, when 26 weeks of leave will be available.
Unlike current leave policies stipulating that most leave is to be used by the primary carer, the 26 weeks can be split between the primary and secondary carer in whatever way is most beneficial to each family.
As our working environment and domestic roles evolve, this distinction reflects the modern working landscape and acknowledges the importance of flexibility in retaining staff.
While the Federal Government’s new policy provides some leverage, employers should not rely on the policy alone for retaining and recruiting employees in the current tight labour market.
Increasingly employees are seeking roles and workplaces that offer good work-life balance, benefits that allow for flexibility in lifestyle choices and businesses with a culture that centres around employee wellbeing.
An Employee Value Proposition (EVP) allows a business to understand and share what successful employees like best about working for an organisation.
Now more than ever, a business should be investing in its people and building an EVP that stands out. It demonstrates its recognition that hiring is a two-way street and illuminates the reasons people are motivated to work for you.
A strong EVP is more than just a value statement and should resonate with employees, starting with identifying your competitive advantage.
Many big employers are already starting to go further in what constitutes a benefits package, with some offering their own paid parental leave scheme as high as 30 weeks.
A paid parental leave scheme may prove an important point of difference between employers, but it should also be considered in a wider business strategy to recruit and retain talent in current and future markets.
A well-rounded talent strategy considers several lifestyle factors that may impact an individual’s work choices. While SMEs may struggle to match such generous leave offerings, consider other ways in which your business could appeal to employees, such as truly flexible working, development opportunities, job sharing opportunities, industry-specific benefits, health and wellbeing initiatives and CSR programs.
There is also gender neutral paid leave – allowing complete flexibility in how parental leave is distributed between partners. Giving families greater choice and flexibility to manage work and family will boost women’s workforce participation and enhance their economic security, while offering your business much needed assurance.
You can also consider offering tailor-made benefits that cater to individual or group interests such as having an interest in sustainability, health and wellness or financial literacy.
Employers who are not offering things like paid parental leave and flexible working conditions run the risk of falling behind their competitors. More than good employee benefits, building an EVP with your people at the centre is critical in building an engaged workforce and ensuring longer term talent security.
There is no ‘one size fits all’ approach to attracting and retaining employees in the SME market. Businesses need to develop an offering that is based on the real wants and needs of their prospective and current employees, and that can only be attained through having quality conversations.