Ethiopian Review

International Business Digest

Maternity Leave: The Global Comparison of a Work/Life Benefit

September 13th, 2009 at 12:33 pm |

The past sixty years beginning just before the close of the last century brought a wave of change that saw more women in the job place than ever before. This influx of women destabilized the traditional dichotomy of women being homemakers and men being the sole bread winners for
families. Women suddenly had to take up the added responsibility of becoming bread winners. From this trend various issues ensued both in the home front between families and also in the work environment the relationship between the employer and employee.

This paper focuses on an aspect of the employee/employer relations that also affects family and indeed the population of a country. Women’s maternity leave issues have become a global concern for work and life benefits employees are entitled to. Different countries have looked at this from varied perspectives from the cost effectiveness to the effect on the society’s population. Concentration will be focused on how government policies in the United States, Canada and the United Kingdom have played out in the different working cultures as well as international instruments needing ratification from countries. Comparisons will be made as well as disparities. The goal will be to draw best practices on this issue from the various experiences. Primary mode for gathering information has been through research from various scholarly works as well as materials from the international labor organization.

Background/History:

Our focus here will be on historical trends on the issue of maternity leave from an international global perspective using the International labor organization as a reference point and then a brief focus on the countries of the US. Canada and United Kingdom.

The International Labor Organization (ILO):

This is the Intergovernmental organization of government’s employers and workers. It sets and supervises international labor standards broken down into conventions and recommendations which countries are encouraged to ratify and implement. It a working body of the United Nations
currently headquartered in Thailand. Foremost in it conventions regarding maternity leave is The ILO Maternity Protection Convention (No. 183) and Recommendation (No. 191), 2000[i]. The First Maternity Protection Convention came about in 1919 and since then the ILO has been a major voice on the rights of women employees. The ILO focuses on Maternity protection concerning the following key issues Maternity) leave, (Maternity) cash benefits, Employment security, Mother & child health protection, Non-discrimination. To date the United States has not ratified this convention. The ILO strongly advocates that reproduction is a function of society, women workers should not bear the burden alone; maternity affects equal job opportunities of women at a time when ever more women of childbearing age join the labor force; health protection of women and child affects poverty levels and maternity protection must not serve population control. [ii]

Canada:

Maternity leave was first introduced in Canada when BC introduced the Maternity Protection Act of 1921. That law prohibited employers from employing women in the 6 weeks after they gave birth. In 1940, the Unemployment Insurance Act was introduced in Canada. It did not cover maternity leave in its early decades. Maternity leave as it currently understood in Canada it was first introduced in British Columbia in 1966 which is a province. Five years later, the federal government followed, amending the Canada Labor Code. Under the 1971 provisions, mothers with at least 20 weeks of insurable earnings could claim up to 15 weeks of benefits through the Unemployment Insurance system. It was more than a touch controversial to cover expectant and new mothers under a program intended for the unemployed, and it represented a departure from provincially-administered maternity leave to a federally-regulated system as it is known today. The last significant change came in January 2001, expanding parental leave and also maternity from 10 weeks to the 35 weeks that Canadians enjoy today.[iii]

The United Kingdom:
Maternity leave was introduced in Great Britain in 1976 the requirements was for full – time to have worked for the same employer for at least two years from the 11th week before the expected week of childbirth, or 5 years if working for less than 16 hours a week. Employees who fulfilled
these conditions had the right to return to work at any time until 29 weeks after childbirth.[iv] Starting in 1977, there were 6 weeks of maternity pay at 90% of the previous salary and 18 weeks of state-paid flat-rate maternity allowance. In 1987, eligibility requirements for the flat-rate maternity allowance changed. It was now no longer necessary to have acquired any length of employer tenure to qualify for this benefit. However, the requirement was introduced to have been insured for a total of 6 months of employment in the previous year. Those who had not changed employers during those 6 months qualified for a higher level flat-rate. However, the right to retain ones job as well as the 6 weeks of maternity pay at 90% of previous earnings still depended on employer tenure. Now, the requirement was to have been employed with the same employer for two years (or five years for part-time employees) by the 15th week before childbirth.[v]

Unconditional leave was extended to 18 weeks in 2000. For mothers of babies born after 1 April 2007, all 52 weeks of maternity leave were made unconditional of employment duration. The length of maternity pay was extended to 39 weeks. However, to receive 90% income replacement for the first 6 weeks and an employer-paid flat-rate for the remaining period, the mother have to have been employed with the same employer before the beginning of pregnancy. Women who did not fulfill this condition are eligible for a state-paid maternity allowance for 39 weeks.[vi]

The United States:

Maternity leave issues in the United States evolved as a result of the increase of women in the labor force especially from the years 1940 to 1997.[vii] The Pregnancy Discrimination Act (PDA) in 1978 was the first real legislation that addressed women labor and pregnancy. The PDA made it illegal for an employer to discriminate against an employee because of pregnancy, childbirth, or pregnancy-related conditions. In 1993 the Family Medical Leave Act (FMLA) presents maternity leave in a new light for American women workers. This act is important for many reasons, because it is the first federal law that requires some employers to offer parental leave to women and men with qualifying employment histories. Women’s participation in the labor force especially surrounding childbirth has been, and continues to be, a governmental and national concern, rather than just a family or individual interest. [viii]

Current Trends

The United Kingdom:
In the UK Statutory Maternity Pay (SMP) is available to the majority of working women to enable them to have a child without any form of discrimination in the work place. Employment law is very clear in the case of pregnancy and maternity leave, with employers unable to penalize a
pregnant member of staff for any issue that may be at all connected with their pregnancy. As said earlier changes to the monetary recompense for statutory maternity pay came about on April 1st 2007, since then the number of paid weeks has increased from 26 to 39. Current statutory maternity leave is for up to 52 weeks, with the first 39 weeks paid. This payment is paid by the employer and is a minimum of 90 % of and employees average earnings for the first six weeks and then up to £117.18 for the remaining 33 weeks of the 39 paid weeks. However, this is the government SMP regulations and employers may have their own maternity pay scheme. Maternity Allowance is offered to non full time working mothers… [ix]

The United States:

While no federal law requires paid maternity leave, two laws give workers important rights related to pregnancy, parenthood, and taking care of seriously ill family members. The Pregnancy Discrimination Act of 1978 (PDA) and The federal Family and Medical Leave Act of 1993 (FMLA) protects workers’ job security during leave taken for the employee’s own disability or illness (including pregnancy and childbirth); the care of the employee’s newly boom, adopted, or fostered child; or to care for an immediate family member (spouse, child, or parent) with a serious health condition. The FMLA applies to employees who work 20 or more weeks in a year and have worked at least 12 months for their current employer and who work for a firm employing at least 50 workers.[x]

Eligible employees are those employees who were employed for at least one year by the current employer, worked at least 1,250 hours during the previous 12 months, and worked for a business employing 50 or more employees within a 75 mile radius of the eligible employee’s work-site. The family medical leave can be used for the birth or adoption of a child, the acquisition of a foster child, and the care of a serious illness of a child, spouse, or parent, or a serious illness of the employee. In addition, during the leave the employer must continue to provide health insurance benefits to the employee who is eligible for family medical leave[xi]

Canada:

Maternity leave Canada is a shared responsibility between the Federal Government and the Provinces. To qualify for maternity or parental leave, an employee must normally have completed a specific period of continuous employment. January 1, 2001, the Canadian government changed is benefit plan. The plan now pays for up to 15 weeks of maternity leave and up to 35 weeks of parental leave (a total of 50 weeks). The Government also amended the Canada Labor Code, to extend job protection for those under federal jurisdiction. Some provincial governments have not kept pace and are still in the process of changing their job protection laws.[xii]

Problems/Concerns

United States
“In Santa Fe, Linda Strauss McIlroy, a first-time mother, is trying to get used to the thought of soon putting her two-month-old boy in day care so she can get back to work.

“It’s hard for me to imagine leaving him,” she says. “Just not being with him all day, leaving him with a virtual stranger. And then that’s it till, you know, I retire. It’s kind of crazy to think about
it.”[xiii]

The United States and Australia are the only industrialized countries that don’t provide paid leave for new mothers nationally, though there are exceptions in some U.S. states. Australian mothers have it better, however, with one year of job-protected leave[xiv]. As noted above the FMLA mandates twelve weeks of unpaid leave each year to: care for a newborn or newly adopted child; take care of a child, parent, or spouse with a serious health condition; or recover from one’s own serious health condition[xv]. To put it another way, out of 168 nations in a Harvard University study last year, 163 had some form of paid maternity leave, leaving the United States in the company of Lesotho, Papua New Guinea and Swaziland.[xvi]

The FMLA is a piece of legislation which over time has been criticized in certain areas. There are two sides to the coin of contentions some come from employees and others from employers. Employee problems with the FMLA stem from denials, failure to reinstate and reduction in pay. For
the employers one such area is the question of notice. In order to trigger the leave benefits under the Act, an employee must give notice to the employer at least thirty days before the leave is to begin in cases involving a foreseen leave.[xvii] Litigation in the courts point to two kinds of actions by employers could lead to a FMLA claim: failure by the employer to provide leave when requested by an employee, or adverse employment actions taken against an employee following a protected leave[xviii] Most common defenses by employers to these claims are first, employers could claim they are not covered by the Act. Second, employers could challenge the applicability of the Act to a particular employee. Third, in the case of alleged substantive violations that lead to adverse employment outcomes, the employer could seek to limit the Act’s reach by establishing acceptable business justifications for the outcome[xix] Court cases arising out of FMLA maternity proceedings do not show clear cut precedents because often times litigators stay within claims within the statute to prosecute and fear trying to bring about judicial precedents because of the costs associated with this.

However various attempts have been made to offer paid maternity leave in the U.S. It comes down to the question of cost, who bears the burden, should it just be employers, employees, the federal of state government or should it be shared? The other question often left unanswered is who will fill in the gap created by the employee who is on leave. The Clinton administration wanted to allow states to use unemployment funds for maternity leaves, but that was shot down by the Bush administration after opposition from business groups concerned with increased contribution to state unemployment funds. A bill introduced in the House by Reps. Pete Stark and George Miller, both D-Calif., would establish a fund that would replace 55% of pay for workers on FMLA leave. Contributions to the fund would come from employers.[xx] A number of states have tried different solutions for instance California introduced family leave with around 50% pay for six weeks, paid from a fund that employees, not employers, pay into. Five states — California, Hawaii, New Jersey, New York and Rhode Island — and Puerto Rico require employers to have temporary disability programs, which pay benefits if the pregnancy is defined as a disability by a doctor. A few others have infant care programs that pay subsidies to low-income families for up to two years.[xxi]

Canada

Across the border in Vancouver, Canada, Suzanne Dobson is back at work after 14 months of paid maternity leave.

“It was great,” she says. “I was still making pretty good money for being at home.”

Across the ocean, in Sweden, Magnus Larsson is looking forward to splitting 16 months of parental leave at 80% pay with his girlfriend. They are expecting their first baby in a week.[xxii]

Though Canada seems to recognize the importance and need for parent/child bonding and nurturing, during the first year after birth to have a liberal European style maternity leave policy the country is plagued with its own problems. In the 2000 the government extended maternity leave
from 6 months to one year. The problem, however, is that the scheme has some major flaws. The mother is required to work 600 hours before she becomes eligible for benefits. This is double the previous requirement that she work only 300 hours to attain eligibility. The benefits are not available to self-employed mothers or those working on contract. The maximum benefit to be received is $413 a week, less taxes, which makes it difficult for many mothers and families to survive financially. [xxiii] Because of these restrictions is many women do not qualify for these benefits and also because of the high taxes, many mothers cannot take advantage of the one year off since they cannot afford to be out of work without sufficient pay.

The province of Quebec is the only French speaking province of Canada. It also is the least populated. In an effort to secure the future of Quebec, the province went a step further to reconcile work and family life by attempting to separate the link between maternity benefits and paid employment benefits. Quebec challenged the Federal Government in the Court of Appeal on eligibly requirements and amount of benefits by arguing that the combined maternity and parental leave benefits be increased to 70% of the mother’s gross earnings. Quebec seeks to encourage the use of money collected from employment insurance to fund this. The Federal Government is yet to respond.

The United Kingdom

Being part of the European Union, the United Kingdom faces mostly the challenges of amending its laws on maternity leave to align the EU directives outlined in European Equal Treatment Directive (2002/73/EC). The changes apply to non-pay benefits during maternity leave and no need for a comparator in discrimination claims this means amending the Maternity and Parental Leave etc Regulations 1999 to apply to women whose expected delivery date is after October 5 2008.[xxiv] These changes stem out of a court verdict the judges made it clear that the United Kingdom had not properly applied the EU directive to its domestic law.

With regards to non-pay benefits during ordinary and additional maternity leave The High Court held that there should be no distinction between ordinary maternity leave (OML) and additional maternity leave (AML) in terms of a woman’s right to continue to receive her non-remuneration terms and conditions of employment. A woman currently on maternity leave is entitled to the benefit of all non-remuneration terms and conditions of employment during OML, whereas during AML she has the benefit of only a limited range of terms. These are related to notice, compensation in the event of redundancy, disciplinary and grievance procedures, membership of a pension scheme, and the implied term of trust and confidence[xxv].

Under the no need for a comparator in discrimination claims, The High Court held that the Government should remove from the sex discrimination legislation the need for claimants to identify a comparator in pregnancy or maternity discrimination claims. No such requirement exists under
European law. Previously, the United Kingdom Sex Discrimination Act 1975 required a woman to show that she had been treated less favorably than she would have been treated had she not become pregnant or taken maternity leave. She had to compare her treatment to that of a hypothetical comparator who was not pregnant, or who had not taken maternity leave. As of 6 April 2008, when the legislative change came into effect, a woman who is pregnant or taking maternity leave has to show only that she has been treated less favorably and that the grounds for the less favorable treatment were her pregnancy or the fact that she has exercised her maternity leave rights.[xxvi]

Recently, the EU announced the intention of raising the amount of maternity pay mothers receive. The EU plan is to increase paid maternity leave to 18 weeks minimum with full pay for EU countries. Currently, the United Kingdom offers 6 weeks at 90% of average salary, with another 33 weeks at a flat rate of £117.18.[xxvii] There is strong opposition for this in Britain however since other EU countries are in support it is very difficult for the Britain to oppose it. However many employers are making comments on how it will become increasingly difficult to employ women of child bearing ages especially when the current economic situation is considered.

There are proponents who side with the EU because they believe it is necessary to protect the future and that means investing in mothers who rear the children who will make up the future. The question is for most small business employers at whose expense? The Government does not seem to be able to carry the burden on its own so it may have to be distributed amongst the employers and taxpayers also. Many employees who work and are of child rearing age do not see why they need to be taxed additionally to help support this new proposition.

Evaluation/Recommendations

In a diverse and fast-changing economic climate, both companies and workers need flexibility. Working time arrangements can have a significant bearing on the efficiency, productivity and competitiveness of companies, not to mention the health, well-being and motivation of their employees.

Maternity leave as an employee benefit is and will continue to be a point of debate between governments, employers and employees. The basic need to preserve life and foster the development of humane citizens is constantly being juxtaposed to cost and effectiveness of policy on this
issue. The European countries are ahead in policies that favor mothers and children. There seems to be a distinct emphasis being placed on maternity care, post natal care and infant and toddler care. Many countries in Europe give mothers the opportunity to fully care for the new born. Germany, France, Switzerland and the Netherlands have the best policies with a 100% pay for one year. In the Americas, Canada tops the list offering women a generous paid leave. Why then is the U.S seemingly lagging behind? Some writers have argued that there has not been enough support from the feminist movement in America as compared to the movement in Europe. In Europe, feminists emphasized special treatment for mothers, including maternity leave and child care. In the U.S the feminist movement wanted equal rights for women and didn’t emphasize special treatment. The U.S. feminist movement has moved away from this viewpoint, but that hasn’t led to a change in maternity rules. One reason is that U.S. women are used to having about three months off and consider it the norm.”[xxviii]

The reality is that it is very difficult for a mother to separate form a new born after 12 weeks. The heartbreak that this causes makes it impossible for the employee to function at a 100%. This affects the mother’s productivity level, emotional balance and concentration.

One common argument is that mother’s inability to take maternity leave affects population growth, the U.S being predominately an immigrant country may not see population decline as a problem but consideration must be given to the number of men and women in the workforce today. Women are increasing working more outside of the home than men are, it is therefore , important to provide for the needs of these mothers as well as the unborn children so that working does not have to be seen as a necessity but as a means of contributing to society.

The provisions of the FMLA often confusing and hard to litigate do not offer enough recourse to the expectant mothers that make it possible for them to really balance work and home. There is a great need in the world today for achieving more harmony between work and family life. The challenges that countries, corporations, and small business employers face with regards to maternity leave can worked out if only society as a whole has developed the inward consciousness to preserve life and society for posterity.

Mothers are the nurtures of society, everything possible should be done to preserve their safety and the child’s safety also. Social conventions and statutory regulations should enhance the experience of the working mother and not deter it. In Japan for instance since 1992 the government has supported companies that offer child care leave which allows either spouse to stay at home with the child for a whole year with 40% of replacement support being provided by the government. [xxix]

Companies can draw from a pool of temporary workers and split the pay of the worker on leave with the temporary help who will not receive benefits from them. This will take care of the question of continuality that most often comes up. The Federal government can then subsidies the pay
and reimburse employers up to 40% of the wages paid to the staff on maternity leave. This assistance should be given to small business owners who do not make annual revenue of over 250,000 a year. There should also be incentives for companies that provide day care facilities for the employees up till the child turn three. This will encourage more women to marry and bare children.

Summary/Conclusion

Women have gained a greater equality in the workplace however; many women choose to stop working after childbirth this does not have to be the case if child care services can be provided. This is an ongoing discussion which will need very strong motivated people to push for a reform that will be of benefit to everyone.

This paper gives synopsis of maternity leave discourse in the U.S. England and Canada, with the regulations of the ILO as a backdrop. It is clear that every country has its own distinct issue arising from maternity leave. The United Kingdom and many other European countries have always provided paid maternity leave, the arguments there stem from increase and the fear that the economy may not be able to carry the burden. Canada is not far behind in its policies relating to maternity leave, in fact a province like Quebec is on the fore front of making maternity leave policies a provincial responsibility as opposed to it being Federal as it is now. Quebec will then be able to tap into money if they succeed.

It is hoped that in the future, more attention will be paid to the FMLA with regards to maternity leave, to provide more time off paid for the birth mother and provide adequate child care subsidies for employers so that women are encouraged to stay at home with their children and do not have to feel pressured to return to work.

- by Infoway | AC

-- rahel

Leave a Reply