Good reason for Hong Kong businesses to be more generous with paternity leave
Fern Ngai calls on Hong Kong firms to offer their workers more than the mandatory three days of paternity leave, as it's good for the bottom line
A law granting employees three days of paternity leave at 80 per cent pay has finally been passed by the Legislative Council after years of debate. While some Hong Kong people have welcomed the offer, seeing it as better than nothing, many others were disappointed by this baby step.
In the debate on the provision, major parties voiced concerns about the operational costs companies will incur, especially the smaller ones, as a result of offering paternity leave. According to government estimates, granting the three days will add 0.02 per cent, or HK$114 million, to total employment costs.
However, many studies have shown that a supportive and family-friendly working environment plays an important role in staff engagement and the attraction and retention of talent, with direct, positive effects on performance and productivity. In our 2013 survey on work-life balance in Hong Kong, Community Business found that 69 per cent of care providers said that a family-friendly work environment was a top consideration when they chose to join, stay with or leave a company. More than half of the respondents (59 per cent) reported that they were willing to leave their job to devote more time to their family.
Joint research by the University of Michigan's Ross School of Business and Georgetown University's McDonough School of Business showed that across industries and job types, thriving, satisfied and engaged employees have 16 per cent better overall performance, experience 125 per cent less burnout than their peers, and are 32 per cent more committed to the organisation. They show 46 per cent more job satisfaction, miss much less work and report significantly fewer doctor visits.
Unfortunately, considerations of the new bill not only undervalued the high administrative and time costs of filling vacancies, but also overlooked the loss of knowledge, expertise, relationships and networks when staff leave.
We believe that the benefits of paternity leave far outweigh the costs. Flexibility is a key success factor for many Hong Kong companies. So, large and small firms should remember the tremendous benefits of offering paternity leave, and consider going beyond this new law to offer a minimum of five days' fully paid paternity leave. This is a tangible way to demonstrate that a company is a caring, family-friendly employer.
Our Gender Diversity Benchmark for Asia 2014 study, published in July, found that 93.3 per cent of multinational companies surveyed already offered five days of paternity leave in Hong Kong, prior to any statutory requirement.
Hong Kong lags far behind some economies in Asia, and beyond, on this front and risks losing its competitive advantage.
The government should be commended for the introduction of five days of paternity leave for the civil service in 2012. However, its failure to convince the Labour Advisory Board of the need for the same in the private sector is a setback in its efforts to promote family-friendly employment practices, eliminate discrimination on the grounds of family status, encourage a higher birth rate, and safeguard the general principle of equality.
Fern Ngai is CEO of Community Business