Paternity Leave: Why Leaders Should Act Now
Recent research shows that extending paternity leave and increasing the related compensation can benefit fathers, families and businesses substantially. More surprisingly, it could also balance out men and women’s involvement in the workplace and reduce the gender pay gap. We explore whether implementing a change to paternity leave could benefit the energy industry.
The report: “Leave in the lurch: Paternity leave, gender equality and the UK economy” by The Centre for Progressive Policy (CPP), Pregnant then Screwed and Women in Data, explores the economic and health impacts of extending the statutory entitlement to paternity leave and pay.
The UK has the lowest paternity leave offering in Europe, providing an entitlement of 2 weeks with a rate of £172 a week, equivalent to £8,900 a year which is only 44% of the living wage.
The report recommends a statutory paternity leave of 6 weeks at 90% of income in line with the current statutory maternity pay.
According to OEUK, over 200,000 people are employed in the offshore energy industry, many of those in skilled jobs. Between 2018-2021 the gender pay gap only improved by 3 percentage points for the industry as a whole, a woeful lack of progress.
So, do we need a legislative change to substantially move the dial and is this the silver bullet we’re looking for?
A legislative change to statutory paternity leave would mean that it would be almost entirely government funded. This investment from the government is estimated to reduce the gender pay gap for the UK by 4% and in doing so, increase economic output by £23billion. This number does not include savings realised through improvements to workers mental health which currently costs the UK economy £117.9billion per year.
AXIS Network’s role is to engage leaders and be a source of best practice for gender balance issues within the energy industry. Our advice to businesses and leaders within the industry is:
Don’t wait for legislative change. Enhance your paternity leave offering now.
The research shows this is of benefit to business, not least because employees are looking for more family friendly policies and in a challenging recruitment market, where many professionals are looking to other industries, showing ourselves to be more inclusive can only be beneficial. A key finding of the OEUK 2021 Diversity and Inclusion Survey was that women are more likely to view a lack of flexible working as a barrier to career progression and consider joining or leaving an organisation because of its flexible working policies.
Most parents are at the mid-career stage, managing young families and increased responsibility in work and not supporting them means the industry risks marginalising or losing the next leaders of our industry.
Mental health also plays a huge part in this; according to the research 63% of dads did not feel mentally ready to return to work when they did. 29% of parents said that they had experienced a new mental health issue in the two years following the birth of their most recent child. The report states that: ‘increasing paternity leave and sharing care responsibilities has been associated with improved mental health for both parents.’
Poor mental health cost UK employers £56 billion a year (2021-22) and was the number one reason for absence from work. In the energy industry, specifically looking at offshore workers, research also found mental health was the number one reason for sickness absence.
Absences due to mental health issues are costing the offshore energy industry a significant sum of money. In 2019 Slater and Gordon6 found that on average UK workers are taking 3.75 days off per year for mental health. For the offshore energy industry with 200,000 personnel that equates to 750,000 lost working days. Taking an £200/day average rate that equates to £150million a year for the offshore energy industry; significant enough for us to be taking action on this basis alone.
How might this impact the gender pay gap? CPP’s analysis of OECD data finds that a woman’s partner taking parental leave is associated with a 34% increase in the likelihood of a woman being physically ready to return to work. The report states: ‘The IFS finds that the gender pay gap grows year on year after childbirth as mothers in low-hours jobs see no wage progression, reaching 33% by the time a woman’s first child is twelve. Overturning such inequalities can boost economic output. For instance, continual improvements in gender equality in pay and workforce participation are expected to improve economic outcomes for developed countries – boosting EU GDP by 6.1% by 20250.’
Ultimately the investment in paternity leave appears to be beneficial for the economy, individual businesses and the workforce. Making these changes now, the energy industry will become a more attractive industry for all, creating a thriving and productive workforce, with the added bonus of balancing the gender pay gap.
Until the legislative changes happen (and the campaigns are in full-throttle for this) then AXIS Network encourage all organisations and leaders within the energy industry to enhance their paternity leave. Research shows it will benefit everyone.