Aussie company Growing Potential calls for ‘unfair discrimination’ to stop

The issue costs workers billions and one Aussie company has called on the government and other business to stop the “unfair” penalty.

Over a million Aussie mums have missed out on more than $1.6 billion in superannuation in the last decade from the government’s paid parental scheme alone and one Aussie company is calling for change, describing the current system as “discriminatory”.

The not-for-profit community service provider, Growing Potential, has announced its 145 staff – of which 91 per cent are women – will now be paid full super while on parental leave for up to 24 months.

The organisation wants to close the gender pay gap when it comes to superannuation.

Women retire with considerably less money in their super funds compared to men. There’s a 28 per cent gap between male and female super with woman retiring with a median superannuation balance of $146,900 compared to men who walk away with $204,107 aged 60 to 64 years.

Ashleigh Bender has worked at Growing Potential for almost seven years and is currently pregnant with her second child, which is due in May.

Ashleigh Bender with her daughter Lola. Picture: Supplied

The 35-year-old took 10 months off with her first child and received no superannuation payments while on parental leave, but was unaware at the time she was missing out on thousands.

“It wasn’t even on my radar which I feel is probably similar to other people my age,” she told news.com.au.

“With my first baby it was about the financial impact then and what that meant while I was on maternity leave and not for the future, especially not super.”

It wasn’t until she returned from leave and moved into a new role in employee relations that she became aware of the huge difference between men and women’s retirement funds.

“I felt like it was really unfair. It shows most of the parents that have time off are women and most of them come back part time for a certain amount of time, so the disadvantage keeps ongoing so it was really frustrating,” she said.

The Sydneysider plans to take 10 months off to care for her second child and this time around she will get around $6700 in super.

She said it feels “great” to work for an organisation that is trying to drive change in this area.

“My first child was a daughter so hopefully by the times she has a family, this will be a normal part of parental leave and not something that a small amount of organisations do,” she added.

Otto Henfling, CEO of Growing Potential. Picture: Supplied

Growing Potential CEO Otto Henfling is calling on other businesses to follow its lead, arguing the more private organisations that make the change, the bigger chance there is of government policy being introduced to equalise the gender superannuation gap in Australia.

“It’s blatantly clear that more needs to be done by all governments to improve gender equality for women at work and the superannuation system,” he said.

“Government – and businesses, even if on their own accord – need to stop penalising women who take time out of paid work to raise children, at a cost of sacrificing thousands in their retirement savings.

“Australian women should not have to make this sacrifice and I am very proud that the vast majority of Growing Potential’s female staff now needn’t contend with this unfair discrimination – and that’s what it is, the current system is discriminatory against working mothers.”

Women have missed out on millions in superannuation while on paid parental leave. Picture: Getty Images

He said leaders of other organisations – especially those within female-dominated work sectors – should take a proactive approach by continuing to pay superannuation on parental leave.

Close to 171,00 women missed out on $216.7 million in super payments in the 2019/20 financial year alone.

A mum-of-two who received super on the government’s parental leave or from their employer would have $26,500 more super at retirement, an Industry Super Australia report from last year found.