Westpac Group, including St George, BT Wrap and Westpac Bank will pay employees superannuation when taking unpaid parental leave beginning July 1st.
Westpac will be a first mover in paying superannuation to employees taking unpaid parental leave and comes after the Federal Government received criticism for not paying superannuation on the Paid Parental Leave Scheme former Prime Minister Kevin Rudd championed this month.
Westpac’s changes to parental leave mean that employees who take unpaid parental leave will now be paid full superannuation payments, for up to 39 weeks. This is in addition to the 13 weeks paid parental leave, with full superannuation payments, that employees are entitled to under Westpac Group’s existing parental leave scheme. This means employee superannuation contributions will now be paid for the full year of their parental leave.
Westpac Chief Executive Gail Kelly could understand the need for superannuation when taking unpaid leave after her own time off work when having children.
“When the idea was first put to me, there was no question that because I’d had children, and periods of unpaid leave throughout my career, I recognised how so very important it was,” Mrs Kelly told The Australian yesterday.
St.George Bank Chief Executive, Greg Bartlett said the approximately 320 St.George employees who take parental leave each year would directly benefit from this initiative.
“We believe it’s important that mothers and fathers at St.George are not disadvantaged in their retirement as a result of taking leave from work to raise a family,” Mr Bartlett said.
“At St.George we were Australia’s first company to introduce Grandparental leave – to support the important role grandparents play in the care of children – and we offer a range of other flexible working arrangements to meet the diverse needs of our 5,700 employees.
Westpac’s changes to unpaid parental leave for employees is estimated to be worth an extra $72,000 at retirement for an employee earning $55,000 a year who takes two periods of paid parental leave after the age of 28.