Fonterra has announced an overhaul of its parental leave package to drive greater diversity and inclusion for its 22,000-strong workforce.
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Under the new policy, which came into force at the start of August, primary carers who meet the 12-month employment requirement will have their government parental leave payments topped up to 100% of base salary or wages for 26 weeks. A significant rise on the previous 16 weeks at 80%, the aim is to allow more new parents to enjoy time with their new arrival.

On their return to work, employees will be paid a one-off employer KiwiSaver contribution of 3% of the salary they would have received during their unpaid parental leave period. Fonterra has also announced new support measures to help parents transition back into the workforce.

Speaking to HRD, Haylee Putaranui, Fonterra’s Head of Diversity and Inclusion, said as the nation’s biggest employer, the new policy sends an important signal across the industry.

“Why it’s so important is because it tactically and tangibly addresses some very real support for our parents. Typically, it’s the female who is the most affected but that’s not always the case,” she said.

“While the financial package is the headline act, the end-to-end support is the other important piece.”

Fonterra sought the experiences of employees to identify the current hurdles that can make leaving and returning to work difficult for parents, Putaranui said. They piloted the use of a fortnightly Returning to Work With Confidence program, run by a dedicated coach, which will be implemented for all parents as part of the new support package. Putaranui said those sessions gave parents-to-be a community of colleagues in the same boat, but also uncovered valuable insights into the lived-experience of employees.

One issue that became apparent was an inconsistent experience for staff, depending on the attitude and approach of their managers. As a result, Fonterra devised a manager’s manual to standardise the support offered and build into all HR communication with staff on the ground. It was also clear that many women in the prime of their careers were hitting a glass ceiling on their return to work.

But Putaranui said the burden shouldn’t be on parents to push back against assumptions about what they can and cannot do while preparing to take leave and the unconscious bias of managers.

“We wanted to be very deliberate to wrap support around both our new parents and our managers,” she said. “I think from what I could see from other organisations, often that is the missing piece.”

While the focus is often on women and how parental leave impacts their careers, there is a lot of work to be done to encourage men to step away from the workplace too. Putaranui said Fonterra plans to encourage leave take-up among its male employees by sharing the voices and experiences of new dads, which is particularly valuable when it comes from the top down.

Using gender-neutral language when communicating with staff about parental leave is another simple, yet powerful, strategy.

“While our leadership is still largely made up of male representation, it’s important they are role modelling for the rest of our employees,” she said. “I do think we can be very deliberate with our leadership role models, our language and just continuing to challenge our assumptions.”

For employees, the financial and emotional support has come as a welcome relief. Communications Senior Business Partner, Cilla Duncan, who is pregnant with her second child, said she had a big smile on her face when she received the news.

“I respect businesses that go beyond what’s required of them to look after their people. These changes to Fonterra’s parental leave policy are an example of that, and I feel fortunate to be one of those who will benefit,” she said.

“I’ve watched too many friends and family go back to work a lot earlier than they would’ve wanted. When businesses step in to provide extra support, I think there are so many benefits at both an individual and societal level – from reducing stress for new parents, to helping tackle the gender pay gap.”

Australian dairy farmers supplying milk to Fonterra could become part-owners of the co-operative’s business across the Tasman.

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