Monday, 30 March 2009

Parential Leave Rights

Last week the London Blogger's Meetup was sponsored by the Equality and Human Rights Commission, they wanted to open up new ways to engage with people, be it blogs or twitter or forums or whatever.

My take on it was if they want to listen to what I have to say to them, my message would be a very clear "Please cease to exist, please stop using tax-payer's money".

Days later I read in t'Guardian that many of their directors were resigning cos they didn't like the direction the organisation was going. Cool, maybe somehow they had heard my message.

Alas, the commission is still in operation and I read more of their doings in the Guardian this morning.
Concluding that it was time that "policy-making enabled men to play an equal part in parenting", the EHRC proposes that the first 26 weeks of a baby's life would remain dedicated maternity leave for mothers, but with higher rates of pay, so that they would receive 90% of pay for the entirety of their maternity leave. Fathers would still get two weeks of paternity leave at the birth of their child, but this would also go up to 90% of their pay.

Beyond the first six months of maternity leave, the commission proposes three blocks of "parental leave", which could be taken any time before the child's fifth birthday, each of about four months, one block dedicated to mothers, one to fathers and one either could take.

The first eight weeks of each of these blocks of leave would be paid at 90%.


We already have Government Advisor Sir Alan Sugar saying that
... he would be less likely to hire a woman of child-bearing age. Explaining that the law was "counterproductive", he said: "If someone comes into an interview and you think to yourself 'there is a possibility that this woman might have a child and therefore take time off' it is a bit of a psychological negative thought."

So it follows that if the parential leave rules extended equally to men, then men of child-rearing age would similarly be at a disadvantage.

Raedwald has it
One of the other consequences will be that employers will tend to employ men and women beyond their childbearing years, or those who can be classed as confirmed bachelors or spinsters. Half a percent of GDP may be peanuts in this age of fiscal profligacy, but the costs of parental leave to a small enterprise can often be crippling. The public sector will take the proposals up willingly, but with the longer term consequence that single men will earn more and occupy higher positions than married men.

In other words, the changes are likely to improve overall the employment conditions of every group other than young would-be parents.

If I ran a company, a small manufacturing organisation perhaps, where you could easily track that one person working one day produces for the company just enough wealth to pay to employ themself and cover overheads, following the direction of the Equality and Human Rights Commission, that one person working is going to have to generate enough wealth for the company to pay for more staff who aren't working.

Hmm, is this going to drive down wages?

Say a worker for a company generates wealth for the company equivalent to twice his wage, so he gets paid, the boss/admin function gets paid and the overheads and material costs and tax and all that, and the woman currently on maternity leave.

If the company now has to pay for a bloke on maternity leave too, a bloke who previously was a good worker, but is now not generating wealth for the company but still getting paid, then the remaining working chaps are going to have to cover for him and generate wealth for the company equivalent to two and a half or three times their wage, just so the company stays in business.

We can't afford to employ more people, so there's only two ways it can go, the workers who are still working have to increase their productivity by a huge chunk and keep the same wage, or get a wage cut and maintain the same productivity.

Neither of these options are particularly easy to implement, aye we're always striving to improve productivity using engineering skill and technological innovation, that's standard practice, so the only thing we can do different is cutting wages or not increasing them for a few years and keeping them low.

Sorry reader, I'm not in a very productive industry, my guys only generate a few times their own wages in wealth. We can't put up prices or we go out of business, we can't afford to employ more people cos they're going to get pregnant anyway.

Equalities and Human Rights Commission, tell me how I am supposed to afford to pay staff 90% pay when they are not generating any wealth for the company?

1 comment:

  1. you're focussing only on the financial rewards for labour - this doesn't compare to the more altuistic rewards of spending time with your kids. If anything, it will help encourage people to have kids so they get more paid time off work, which will be good for the Dependency Ratio.

    Interestingly, it my also have an unintended consequence of rebalancing the family dynamic, where it encourages the higher wage earner to take the most time off as their 90% would be more beneficial.

    Or it's just a bunch of nannying bollocks - you wonder who selects this lot! One of them was on Today this am spouting bobbins....