Five actions employers can take to improve outcomes for women
There have been some important issues raised this year around women and what must be done to achieve better outcomes for their financial futures.
The federal government’s May 2021 budget included some measures that will benefit women, including increasing the childcare subsidy offered to some families and removing the rule that exempts employers from paying super contributions for those earning less than $450 a month, proposed for 1 July 2022.
But with Australian women still earning on average 13.4%^ less and retiring with 47%* less super than men, the gender super gap remains a serious problem. And while in this and previous years’ budgets there have been some measures introduced to improve retirement outcomes for lower income earners (which disproportionately include women), there is more that should be done.
Advocacy group Women in Super has a list of changes that would help achieve greater equality. These include (but are not limited to) making sure there are no further delays in increasing the super guarantee to 12%, ensuring that super is paid on parental leave, and measuring and publishing the impact that any future changes to super would have on women. Pleasingly, the SG rate will increase to 10% from 1 July 2021.
I agree and believe that any policy that allows members to take money out of their super accounts (particularly in down markets) throughout their working lives should be discouraged and specifically considered with the long-term consequences for women in mind.
And, although the increased childcare subsidy is a good start, if the government is serious about jobs and women, then it must do more to alleviate this hugely expensive and obvious deterrent for returning to the workplace after having children. It goes without saying that the longer women are out of the workforce, the greater the gender super gap.
Five steps employers can take
While policy change is critical, I cannot help but think improving outcomes for women will require more than legislative change. Structural change in the way we work and share parenting responsibilities is also required but there’s much that can be done at the workplace level. At CareSuper we work with thousands of employers, many of whom are taking steps to address inequality, and we are continuously aiming to improve our own approach as a fund and employer. The following are not by any means new, but they are simple and effective ways that we have found can make a difference.
1. Consider the gender pay gap
Unfortunately, a gender pay gap still exists in most industries. For example, the Workplace Gender Equality Agency statistics show there is a 23% gender pay gap within the super sector.^
Using benchmark salaries provided by an external supplier is a good way of determining what is fair remuneration for each role and paying all employees according to ranges around the benchmarks — this is one of many systems we use at CareSuper. We also have a remuneration policy in place across the whole business to ensure we are always paying people for their work, regardless of gender.
2. Provide equal opportunities
Representation at every level of a business is important. The evidence shows that women aren’t afforded the same opportunities as men in many professional settings, and business leaders can address this.
We purposefully strive for equal representation at CareSuper because we believe it achieves the best results for our members. Our board and executive teams are equally split between women and men, and we consciously seek gender diversity when making hiring decisions while ensuring that we recruit people with the relevant qualifications, experience and aptitude.
Additionally, employers can consider how best to encourage career progression for women when so often they are overlooked for new opportunities, particularly if they have taken time away from work to have a family.
In practice, this could be achieved by offering secondments, higher duties, training programs and mentoring. Training and development policies and budgeting should ensure that women are offered the same opportunities as men and employers are encouraged to monitor training expenditure on a gender basis.
3. Consider flexible working
During lockdowns in 2020 it became evident for both employers and employees in many sectors that working from home is not only possible but can improve productivity and commitment.
Not all industries lend themselves to working from home, but where feasible, employers could consider implementing permanent flexible working policies to facilitate greater work-life balance for all while maintaining a level of workplace presence to ensure collaboration and culture are maintained. Saving time and fuel/energy on commuting has many benefits.
I believe that having flexible working in place at CareSuper has benefitted our internal culture, and we’ve implemented this structure from the top, even prior to pandemic lockdowns. Having leaders with different work arrangements encourages other team members to follow suit.
4. Offer paid parental leave
Offering paid parental leave (with super contributions) is another step employers can take to create better gender equality, and it also often makes good business sense.
Supporting employees with parental leave fosters loyalty and retention, which is good for the bottom line long-term. Often the cost of offering parental leave is less or equal to replacing a good employee who leaves because of the lack of financial and other forms of support.
Although parental leave is often used by women, I urge business leaders to encourage all employees to take it. Societal norms around the world are shifting regarding equality in caregiving, and many companies are changing their policies as a result.
5. Work with your default super fund
Finally, partnering with a default super fund that takes women’s financial outcomes seriously can make a positive difference.
One of the ways we support our female members at CareSuper is by offering gender-based insurance rates to reflect the different claims statistics of men and women. Because claims experience is lower for women, they pay lower premiums for death and TPD cover. We also offer all members the option to waive their insurance fees for up to 12 months while on parental leave.
Having a representative from your fund come into the workplace to educate employees about super and help them to take action that will improve their long-term financial outcomes can be valuable. It’s a way of showing your employees that you care about them and their future. That’s part of the service we offer our employers, in addition to offering financial advice services for members and a range of events and webinars dedicated to women. These cover topics such as women’s retirement planning, leadership and career development as well as hosting motivational speakers.
The time for change is now
The journey to improving retirement outcomes for women has been slow and long to date, and I hope the recent spotlight on women’s issues will help accelerate further change.
If we do not address the gender super gap, it is predicted that by 2030 the retirement savings gap will still be 39%, with average super balances at retirement projected to be $262,000 for women and $432,000 for men.#
Whether in a partnership or single, women need financial independence and the ability to retire with dignity and make choices for themselves. A policy agenda that focuses on improving outcomes for women is welcome, and I hope business leaders are equally inspired to take action today.
To find out more about CareSuper call us on 1300 360 149 or visit our website.
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^Australia’s Gender Pay Gap Statistics 2021. Published 26 February 2021. https://www.wgea.gov.au/publications/australias-gender-pay-gap-statistics
* Women in Super: The facts about women and super. https://www.womeninsuper.com.au/content/the-facts-about-women-and-super/gjumzs
# Industry super: Closing the superannuation gap. https://www.industrysuper.com/campaigns/closing-the-gender-superannuation-gap/