Government Extends Paid Parental Leave Scheme

Prime Minister Helen Clark and Women's Affairs Minister Ruth Dyson announced today that the eligibility and duration of paid parental leave is to be extended.

The leave period will be extended from 12 to14 weeks, phased in over two years. Parents will also be able to take paid parental leave if they have been in the same job for at least six months, rather than a year as at present.

Helen Clark and Ruth Dyson said an evaluation of the paid parental leave scheme shows it has been a resounding success. (The evaluation report can be seen at http://www.ers.dol.govt.nz/parentalleave/evaluation.html)

"The Department of Labour's evaluation shows both employees and employers have adjusted well to the entitlement, with few administrative or employment issues arising.

"The ability to take 12 weeks paid leave, and return to the workplace has increased employees' well-being and feeling of being appreciated, while retaining competent staff has been a benefit to employers.

"Two-thirds of all recipient parents stated that there were no drawbacks of the scheme for them. Of the third that did cite drawbacks, the most frequently mentioned was that the length of paid leave was not enough.

"Although business groups had voiced some concerns prior to the scheme's introduction, a third of employers surveyed last year cited a positive or very positive impact on their businesses, half said it had no real impact, and only nine per cent believed the overall impact of paid parental leave had been less favourable.

"From the employers' perspective, the most frequently cited benefits of the scheme were: that staff were happier and more satisfied, that they were more likely to retain experienced staff, and that the scheme stopped mothers returning to work too early or before they were ready."

Helen Clark and Ruth Dyson said that New Zealand has long been at the forefront of many initiatives to improve family and women's rights.

"It is satisfying that in the area of paid parental leave, where New Zealand has lagged behind the rest of the world, we have not only made progress, but also that progress has been largely accepted by New Zealand employers and employees. "New Zealand businesses have to compete internationally for skilled employees, so it is important that New Zealand employees' quality of life matches that of other developed countries.

"Extending the paid parental leave scheme will be positive for families, for businesses, and for the country," Helen Clark and Ruth Dyson said.

Eligible parents will get 13 weeks of paid parental leave from 1 December 2004, and 14 weeks from 1 December 2005. The two-phase introduction will bring New Zealand into line with International Labour Organisation standards.

Parents who have been in a job for at least six months will now also qualify for paid parental leave. Their job must be held open for the 13 weeks (increasing to 14 in 2005) while they take their paid parental leave.

Further work will be carried out this year on the feasibility of extending paid parental leave to self-employed.

It is estimated that around 26,000 employed women have babies each year. Latest figures now confirm that 19,000 parents accessed paid parental leave in its first year. A further 3,400 women are expected to benefit from the extensions to the scheme.

The combined cost of the new proposals for a full year is $17.3 million. This adds to the current annual expenditure for the scheme of $51 million.

ENDS

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