Thursday, 17 June 2010
Paid Parental Leave Bill 2010
Consideration of Senate Message
Bill returned from the Senate with amendments.
Ordered that the amendments be considered immediately.
(1) Page 2 (after line 10), after Division 1, insert:
Division 1A—Object of this Act
3A Object of this Act
(1) The object of this Act is to provide financial support to primary carers (mainly birth mothers) of newborn and newly adopted children, in order to:
(a) allow those carers to take time off work to care for the child after the child’s birth or adoption; and
(b) enhance the health and development of birth mothers and children; and
(c) encourage women to continue to participate in the workforce; and
(d) promote equality between men and women, and the balance between work and family life.
(2) Generally, the financial support is provided only to primary carers who have a regular connection to the workforce.
(3) The financial support provided by this Act is intended to complement and supplement existing entitlements to paid or unpaid leave in connection with the birth or adoption of a child.
(2) Clause 63, page 62 (lines 3 to 8), omit subclauses (1) and (2), substitute:
(1) Parental leave pay must be paid to a person by the Secretary in instalments.
(3) Clause 64, page 62 (line 16) to page 63 (line 18), omit the clause, substitute:
64 A person’s instalment period and the payday for an instalment
(1) A person’s instalment period is the period of 14 days starting on a day the Secretary considers appropriate for the person (or a class of person in which the person is included) and each successive 14 day period.
Note: Sections 93 and 94 affect when an instalment period for a person starts and ends in certain circumstances.
(2) The payday for the instalment is a day that the Secretary considers appropriate that occurs after the instalment period to which the instalment relates.
(4) Clause 67, page 64 (line 22), omit “An employer or the Secretary”, substitute “The Secretary”.
(5) Clause 67, page 64 (lines 26 to 31), omit the note.
(6) Clause 68, page 65 (line 13), omit “An employer or the Secretary”, substitute “The Secretary”.
(7) Clause 69, page 65 (lines 18 to 21), omit subclause (1).
(8) Clause 69, page 65 (line 22), omit “(2)”.
(9) Clause 70, page 66 (lines 5 and 6), omit subclause (2) and the note.
(10) Part 3-2, page 67 (line 1) to page 75 (line 9), omit the Part.
(11) Clause 83, page 76 (lines 3 to 16), omit the clause, substitute:
83 Guide to this Part
This Part is about the payment of instalments to a person by the Secretary.
The Secretary is required to pay instalments directly to a person on the payday for the instalment.
In certain circumstances where the Secretary becomes required to pay instalments to a person, the Secretary is also required to pay the person arrears for instalments that had previously become payable, but not been paid, to the person.
(12) Clause 84, page 77 (line 2) to page 78 (line 28), omit the clause, substitute:
84 When the Secretary pays instalments
The Secretary must pay an instalment that is payable to a person on the payday for the instalment.
(13) Clauses 85 and 86, page 78 (line 27) to page 80 (line 12), omit the clauses.
(14) Clauses 93 and 94, page 84 (line 1) to page 85 (line 1), omit the clauses.
(15) Page 86 (after line 29), at the end of Division 2, add:
99A Payment of paid parental leave does not affect other employer obligations
An obligation of an employer to pay a person parental leave pay under this Act is in addition to any other obligation the employer may have in relation to the person, however that other obligation might arise (including, for example, under another law of the Commonwealth, a State or a Territory, or an industrial instrument (however described)).
(16) Part 3-5, page 87 (line 1) to page 101 (line 8), omit the Part.
(17) Clause 117, page 103 (lines 15 and 16), omit paragraph (c).
(18) Clause 117, page 103 (line 19), omit “;”, substitute “.”.
(19) Clause 117, page 103 (lines 20 to 25), omit paragraphs (e) to (g).
(20) Heading to clause 133, page 112 (lines 3 and 4), omit “or PPL funding amount”.
(21) Clause 133, page 112 (lines 8 to 15), omit paragraph(1)(b), substitute:
(b) order the person to pay the Commonwealth an amount equal to any amount paid to, or in relation to, the person by way of an instalment of parental leave pay because of the act, failure or omission that constituted the offence.
(22) Clause 138, page 113 (lines 21 and 22), omit “or a PPL funding amount”.
(23) Page 236 (after line 20), after clause 307, insert:
307A Review of the operation of this Act
(1) The Minister must cause a comprehensive review of the general operation of this Act to be begun by 31 January 2013.
(2) The review must consider the following matters:
(a) the amount of time off work that primary carers are taking to care for newborn or newly adopted children;
(b) the availability and amount of leave and payments provided by employers in relation to the birth or adoption of a child, and the interaction of those entitlements with parental leave pay provided under this Act;
(c) the operation of the work test;
(d) whether primary claimants’ partners should be paid parental leave pay separately from, or in addition to, primary claimants;
(e) whether employers should make superannuation contributions in relation to parental leave pay;
(f) the results of any evaluations conducted in relation to the operation of this Act;
(g) the administration of this Act;
(h) any other matter relevant to the general operation of this Act.
(3) The Minister must ensure that public submissions are sought in relation to the review.
(4) The Minister must cause a copy of a written report of the review to be tabled in each House of the Parliament within 15 sitting days of the day on which the Minister receives the report.
I thank the opposition for providing this opportunity to deal with the Paid Parental Leave Bill 2010 at this point. I indicate to the House that the government proposes that amendments (1), (15) and (23) be agreed to and that amendments (2) to (14) and (16) to (22) be disagreed to. I suggest, therefore, it may suit the convenience of the House if we first consider amendments (1), (15) and (23), which are the ones we are going to agree to, and when those have been disposed of then consider amendments (2) to (14) and (16) to (22). Therefore, I move:
That Senate amendments (1), (15) and (23) be agreed to.
I will briefly explain the implications of what the government proposes. The Senate has returned to the House the Paid Parental Leave Bill 2010 and the Paid Parental Leave (Consequential Amendments) Bill 2010 with a series of amendments. The government moved a number of these amendments in the Senate in response to the recommendations of the Senate inquiry and will obviously be accepting these amendments in this place. These government amendments, firstly, insert an object clause in the bill; secondly, clarify that an employer’s obligation to provide parental leave pay under the bill is additional to any other obligation of the employer, in particular an obligation to provide employer funded paid parental leave; and, thirdly, insert a clause to give effect to an existing commitment of the government to have a comprehensive review of the Paid Parental Leave scheme. I indicate to members opposite that these amendments were all agreed to in the Senate when they were debated there. That may help the opposition in their consideration.
For the information of those opposite I will also take this opportunity to refer to the amendments that we will not be accepting. We will not be accepting the amendments moved by the opposition in the Senate to remove employer involvement in Paid Parental Leave. Employer involvement is a central element of the Paid Parental Leave scheme and we want paid parental leave to be considered a normal part of employers supporting women after giving birth to take leave from work to care for their children. The bill’s intention is that women maintain their attachment to the workforce while they are having their family. Women will maintain that strong connection by receiving their government funded parental leave pay through their employers as they would receive any other work entitlement.
Employers will benefit from the scheme through the retention of skilled staff without having to fund the scheme. Our scheme is government funded, not paid for by an increase in the company tax rate for certain companies. For the information of those opposite, only nine per cent of all businesses and only three per cent of small businesses will be involved in Paid Parental Leave in any given year.
To help employers prepare for the scheme, the role of employers in providing government funded parental leave pay will be phased in over the first six months to align with the new financial year. Employers will only be required to pay an employee where they have received sufficient funds. Employers will provide parental leave pay on a business-as-usual basis; they will not be required to lodge regular reports with the Family Assistance Office or establish special bank accounts. Parental leave pay will be paid in accordance with an employer’s normal pay practice and the employee’s usual pay cycle. There is no payroll tax and no workers compensation payable. Paid parental leave will be implemented in close consultation with employers, including through the Paid Parental Leave Implementation Group. This element of the bill, employer involvement in payment for long-term employees, was recommended by the Productivity Commission as it sends a very strong message that taking leave from work around the time of a birth is a normal part of work and family life. The bill is fair to business and fair to families.
The passage of this legislation today is a landmark reform for Australian families. It is the result of a lot of hard work by generations of Australian men and women. Its passage today will be a tribute to each and every one of them. I commend the bill, as amended, to the House.
On behalf of the opposition I indicate that we are in agreement with the government on Senate amendments (1), (15) and (23) and acknowledge the government’s work and acceptance of those amendments and the purpose of them.
Question agreed to.
That amendments (2) to (14) and (16) to (22) be disagreed to.
As I have already indicated our reasons I will not speak any further to those amendments.
This is where the opposition departs from the government’s position. The government has made precisely no case whatsoever as to why small employers should be fitted up with the payclerk obligations of administering this scheme. The government has not even attempted to address the very serious, genuine and heartfelt concerns of the small business community that it does not need to be in this role, it does not welcome this role and it sees no justification for this role. Moreover, it finds it bewildering that the Commonwealth would invest in setting up administrative and payment systems for the first six months of the operation of this scheme to be handled by the Family Assistance Office, not requiring small businesses to be the payclerk, and why it should then, having made that investment and established what in every respect is an adequate set of arrangements for the first six months, walk away from that taxpayer investment just to fit up small businesses with that responsibility. It has made no case for that whatsoever.
The only justification that could possibly be made is a very dubious and distasteful one, and that is that, having set up the administrative and payment systems that drop small business into a role it has no business being in, the opportunity to top up the payments that are part of the government system will become an obligation to top them up. The risks that small businesses face include the risks of noncompliance in the administration of this scheme, the impact on other operations and the direct expense of varying and updating their payroll and accounting systems. The government has also put forward unconvincing arguments about how these payments would reflect in payroll related obligations that may be present in terms of superannuation, payroll tax and workers compensation.
Those are all known risks they face—not to mention the regulatory and red tape burden that small business could well do without as many of them struggle to be viable enterprises in this difficult economic environment—but there is a bigger risk. No case whatsoever has been made to fit up small business with this obligation, but the real risk is that small business will then be fitted up with an obligation to top up these payments. All the systems are being set up to achieve that goal. I say to the government: shame on you for ignoring very considered and legitimate concerns raised by the small business community. Shame on you for not even attempting to make the case as to why this is necessary. Shame on you for investing taxpayers’ funding in a perfectly adequate set of arrangements administered by the Family Assistance Office which are going to be abandoned after six months with no justification whatsoever. I would urge you to be clear and very careful about how you use these tools that you are setting up.
The small business community and the coalition parties will rise as one to hold you to account and will no doubt point out how duplicitous this process has been if, shortly after it is in place, this payclerk role fitted up with the administered obligations becomes a requirement to top up these payments in recognition of the many views around this nation, including in the coalition, that this arrangement is inadequate and does not provide the level of support that families are looking for. The government will say, ‘We’ve heard that voice, and the employers can stump up the rest of the money,’ knowing that the administrative systems are in place. So we will oppose this on the voices in the House of Representatives. We will not hold you up in the Senate because we know your game. We are not about denying the rollout of this program. We have run the argument about why these provisions are unnecessary—(Time expired)
In adding my voice to that of the shadow minister for small business, let me say that, in addition to the burden for small businesses that the amendment we put forward would have helped resolve, there is another dimension to this problem. I am concerned that when a small business, particularly a microbusiness with perhaps two or three employees, has to make a choice between two candidates for a new job, a woman of child-bearing age and man, and it knows about the administrative burden that it is going to have to take up with paid parental leave, that will see discrimination against the woman candidate. I do not think that is acceptable. We have already got a lot of discrimination in the Australian workforce in relation to women, with the gender pay equity problems. This reinstates or puts into place additional potential discrimination against women.
I cannot understand for a minute why a government which has said that it will for six months have a moratorium on all businesses handling the payroll function cannot extend that, given in particular that the six months of payroll attention from the Family Assistance Office will continue beyond six months for the employees who do not have an employer who can be readily nominated, like the contract workers, the self-employed and the casual workers. They will continue to have their paid parental leave come through the Family Assistance Office indefinitely, but we are told that, for others, who have an identifiable employer, their payroll moratorium will cease after six months. We think that this is a very serious problem.
The good news for Australian business and for Australian women is that when we get into government we will introduce an appropriate scheme which, in particular, will not burden and be a problem for businesses and will give working families every chance to have a good parental leave scheme that is amongst the world’s best, not amongst the world’s poorest and most inadequate.
I present the reasons for the House disagreeing to the Senate amendments (2) to (14) and (16) to (22) and I move:
That the reasons be adopted.
Question agreed to.
Message from the Governor-General recommending appropriation for the bill and proposed amendments announced.