Overview

More than 2.5 million people are employed in small business, approximately 48 per cent of the total private sector workforce. Employees are likely to be workers with family responsibilities which means that in addition to their work roles, they have to manage child care, care of elderly or ill relatives and attend to the myriad of household tasks that keep family life functioning smoothly. This book, based on a qualitative study of a diverse range of small businesses, extends our understanding of how employers perceive and respond to the needs of workers with family responsibilities. The forthright opinions of small business employers, quoted throughout the book, are set within the broader context of findings from the work-family literature.

Table of Contents

• 1 About This Study
  • The Small Business Context
  • Methodology
• 2 Organisation of Work and Family Life
  • Work-Family Stress
  • Why Employers Should be Concerned
  • What Families Need
• 3 The View From Small Business
  • Employer Concerns 
  • Business Survival 
  • Government Policy 
  • Recruitment/Retention 
  • Retention/Absenteeism
  • Stress 
• 4 Connections Between Family Life and Work 
  • Family Concerns and Work Productivity 
• 5 How Businesses Accommodate Workers With Family Responsibilities 
  • Flexible Working Arrangements 
  • Time-off Flexibility 
  • Rights, Privilege and Reciprocity 
  • Parental Leave 
  • Calling Home 
  • Child Care 
  • 'A Good Place to Work' 
  • Other Benefits 
• 6 Being Supportive of Family Life
  • Benefits
  • Constraints
  • Incentives
  • Who Should Be Responsible?
• 7 Attitudes Towards Workers With Family Responsibilities
• 8 The Challenge of Change 
  • Employer Reactions
  • Implications
  • Towards the Future
• References

Foreword

Small businesses are the backbone of Australia's productive workforce. They employ over 2.5 million people, about 48 per cent of the total private sector workforce. What they do is important. Employers with small numbers of employees are more likely to know their workers personally and to share the trials and tribulations of each worker's family life. Or are they? In the context of Australia's ratification of ILO 156 on Workers With Family Responsibilities, we did not know.

We need to know because Australia is obliged under ILO 156 to help workers achieve a balance between work and family demands, insofar as conditions permit. The means by which large companies can do this - flexible work times, child care provisions, computerised family support information systems, formal leave provisions - may not be open to smaller businesses who have nobody to 'cover' while a skilled worker is absent, who rely on teamwork, who cannot be open seven days a week or readily adjust to non-standard working hours. So it is one thing to expect large companies to develop benefits and work systems to meet changing family needs; it is another altogether to see how good principles might work in practice in smaller work contexts.

This Institute's earlier studies of maternity leave, big business responses to workers with family responsibilities, and our reviews of Australian and overseas best practice, left a gap in relation to small business. This report, A Matter The Institute is most grateful to these business people for their cooperation and frankness, and to the Department of Health, Housing and Community Services for its assistance in providing funds to enable publication of the report.

Don Edgar
Director
Australian Institute of Family Studies

1 About this study

life will affect the achievement of family wellbeing and business productivity. Current demographic and social trends highlight these concerns. Forty-two per cent of men and 40 per cent of women in the workforce have dependent children. In approximately 60 per cent of two-parent families with dependent children, both parents are in the labour force. As well, 47 per cent of sole mothers and 69 per cent of sole fathers with children under 14 years are employed outside the home (ABS 1992b).

Government, unions and employers are paying increased attention to how the often-conflicting demands of work and family life can be met with benefits to the workplace and families. A number of government and union initiatives are already in place. The Commonwealth Affirmative Action Act 1986 and the Sex Discrimination Act 1984 provide for the advancement of women in education and employment and protect them against discrimination on the grounds of sex, pregnancy and marital status. Australia's ratification of the International Labour Organisation (ILO) Convention 156: 'Workers With Family Responsibilities' (1981) requires signatories to promote services and policies to facilitate the ability of workers with family responsibilities 'to engage in employment... to the extent possible without conflict between their employment and family responsibilities'.

In 1991 the Industrial Relations Commission, in acknowledgment of the increased sharing of family responsibilities between women and men, decided in favour of the ACTU case and granted unpaid parental leave of up to 51 weeks after the birth of a child to mothers and fathers. The decision incorporates the opportunity to return to permanent part-time work, at the employer's discretion, up to the child's second birthday.

The Australian Council of Trade Unions (ACTU) has incorporated work and family issues into the union agenda. The union has identified the provision of family benefits (such as employer-subsidised child care, leave for family emergencies and sick leave to cover illness of family members) as important considerations in enterprise-based bargaining negotiations with employers (ACTU 1991).

Many 'leading edge' Australian companies have established child care centres on or near site; others have set up school holiday programs. Increasingly, corporations have instituted alternative working and leave arrangements to account for days off for family illness, school holidays and reduced hours upon return from maternity leave. Permanent part-time work, job-sharing, averaging hours and telecommuting are some examples of company policies that facilitate balancing work and family life (Adie and Carmody 1991).

The attitudes and responses of Australian big business towards the issues of work and family have been canvassed (Wolcott 1991). Little is known, however, about the attitudes and circumstances of small businesses in Australia regarding these issues. Because of their size, small businesses confront different problems and have particular needs that may be overlooked when dealing with policies and initiatives that address the work and family roles of employees.

This report attempts to extend our understanding of how small business enterprises perceive and respond to connections between work and family life. It presents the findings from a qualitative study of Australian small businesses that explored employer perceptions, attitudes and responses to questions about the reciprocal effects of work and family life. Policy implications are also addressed.

8 The Challenge of Change

This qualitative study of small business employers' views of work and family life has revealed many similar opinions to those of large companies, but with some important differences in emphasis and approach.

Employer reactions

Small business is more difficult than large companies to categorise, since businesses can range from a single, self-employed owner to a company with 99 employers, the latter less distinguishable from a large company in terms of policies and some resources, the former seeing themselves as autonomous and self-regulating. Still, four themes can be identified in this study of small business employers.

A traditional view of work and family roles

Employers, for the most part, believed family life affected productivity at work only moderately. This belief was frequently based on the presumption of a traditional view of how work and family life was organised. With the exception. of women owners/partners, small business employers, like their more institutionalised colleagues, tended to believe that balancing work and family roles was mainly a predicament for women employees, particularly mothers.

Unlike large corporations, small businesses did not have human resource departments or equal opportunity officers to raise awareness or convene taskforces to address any issues of workers with family responsibilities.

As the owner of a telecommunications firm said when he responded to the question of whether his employees took time off for family needs by saying that he didn't ask reasons, but also insisted that he ran an 'open door' management, 'It sounded like I don't really know very much about my employees. It makes me think about that.'

Not an appropriate concern of small business

Whereas major corporations in Australia and overseas are launching work and family policy initiatives in response to the changing demographics of the workforce and government legislation in equal opportunity and affirmative action, small business employers generally exempted themselves from having to take action on these issues.

Overall, small business employers did not believe that these dilemmas were an appropriate concern of small business because of their size and limited resources.

Peak small business associations voice similar sentiments. Discussions with representatives of the Queensland, New South Wales and Victorian Employers' Federations, for example, revealed little attention to issues directly related to workers with family responsibilities. A recent survey of employee relations in small businesses conducted by the Confederation of Australian Industries did not include any work and family questions. The diversity of small business precludes any generalisation about how small businesses might respond to work and family concerns.

Annual reports of the Small Business Unit, Department ofIndustry, Technology and Commerce (1991, 1992), recent editions of the Small Business Review, published by the Bureau ofIndustry Economics (1989, 1991) and the inquiry into small business by the House of Representatives' Standing Committee on Industry, Science and Technology (Australia. Parliament 1990) did not raise any work and family issues. The Small Business Coalition has focused on six priority issues: taxation, market power, regulation, finance, management education and training and export facilitation.

Family benefits too costly for small business

The majority of small business employees believed the provision of family benefits would impose an unwarranted financial burden on small businesses. In a number of cases, employers indicated that they would have to reduce staff, not hire additional workers, and increase consumer prices or fees if they had to meet the costs of benefits without tax or other concessions. The exceptions were firms that employed highly skilled technical and professional people, where retention of these employees was considered cost-effective.

Questions of survival in a poor economic climate and reduction of taxation burdens on small business were the priority concern of peak associations. Association representatives argued that the economic situation would be a barrier to the ability of small business to absorb any additional costs perceived to be associated with providing familyfriendly benefits such as child care or paid leaves for family care.

On the other hand, the employers interviewed and association representatives pointed out that small businesses could offer flexibility in working hours that should meet many needs of workers with family responsibilities.

Opposition to legislated benefits

While nearly all employers interviewed declared either that they followed award conditions where applicable or went beyond award requirements, many of the small business employers expressed (as do many corporate spokespeople) a preference for an informal system of benefits and rewards contingent on perceptions of loyalty and performance of workers.

Most of the employers, as the quotations illustrate, believed that they operated on a system of objective principles of reciprocity: good workers earned time off and could have some flexibility in their working arrangements whenever necessary. Except in circumstances where awards precluded flexibility, a situation most decried, employers all stated that the ability to be flexible, to respond to the needs of the business and the employee on a case by case basis was the best way to resolve work and family problems.

'1 have a natural antipathy to being told how to run a business, however since there is so much flexibility anyway, family leave would not be a problem.' (medical practice)

According to Callus et al. 's (1991) Australian workplace industrial relations survey, small private sector workplaces with a high proportion of working owners tend to operate in an informal, pragmatic manner, with fewer rules and procedures than larger organisations. Owners/ managers in small workplaces were also more likely than in larger firms to adopt case-by-case approaches to managing employees.

However, the authors observed: 'Unwritten rules are not inherently more flexible than written formalised rules given the differential power relations between managers and employees' (p.123). Even in large corporations where formal policies are in place, supervisors and managers often make decisions and interpret policies narrowly or broadly based on case-by-case circumstances (Wolcott 1991).

The views of representatives of small business peak organisations add strength to this assumption. A chief executive officer of the Council of Small Business Organisations was asked how small businesses, in general, feel about the provision of family support benefits such as child care or time off for child and elder care needs. He commented: 'I view this aspect of things with stark horror. Small business is sick and tired of additional on-costs to doing business that should be the responsibility of the individual or the government.'

He went on to say that small business owners are themselves family people and, with obviously some exceptions, are willing to be flexible and to accommodate their workers: 'They will work things out, glad to give time off if necessary to care for a sick child or grandmother, so long as they make up the time, come in later or earlier, get the work done.' However, 'they don't need two-and-a-half inches of legislation to tell them what to do' (personal communication).

Implications

Even if the premise is accepted that the majority of small business proprietors would be (and in this study the majority were) sensitive and accommodating to the needs of their workers, the question still arises of whether statutory rights rather than discretionary privilege or reward are to govern conditions of work. If equity rather than expediency are to be the measure, then the importance of legal and enforced minimum standards of procedures and conditions for workers in small as well as large firms appears essential. Previous comments of some of the employers interviewed about being selective in their hiring of women who were in the childrearing age range, and views of small business associations about the costs and inconvenience of providing family benefits, reinforce this conclusion.

Comments from employers also suggested that provision of any but minimum statutory benefits would usually be reserved for skilled and difficult-to-replace workers. Alternative working arrangements would be organised for highly valued staff Although similar opinions are often expressed by management in large corporations, there are important differences between small and large companies.

While there will be variations in the degree to which large corporations carry out formal policies and programs that assist workers with family responsibilities, a greater proportion of employees would have access to organisational resources such as an employee assistance program, human resource manager, Equal Opportunity officer, union representative and scrutiny by the Affirmative Action Agency where concerns could be raised. Small business employees usually rely only on the relationship between themselves and their employer to ensure information about and access to entitlements. Such a relationship may be sympathetic or problematic.

Several employers mentioned that in small businesses, like their own, employers and employees negotiated their own enterprisebargaining agreement in terms of flexible working arrangements. A food manufacturer organised different shift hours for an employee who was doing a higher degree. A law firm negotiated an extra month off without pay for an employee who had to go interstate to arrange a nursing home for her mother. A high-tech firm was about to embark on a formal agreement with their workers and the union. In addition to reorganising leaves, flexitime bands, rostered days off combined with 12-hour days and a 'banking hours' scheme are to be considered.

A survey of enterprise-bargaining agreements in New South Wales (Plowman and Favotto 1992) found that many small businesses believed they did not need specific agreements, because their workforce was already flexible. Small firms that were interested in negotiating agreements tended to seek change in over-award conditions. An increase in the span of ordinary working hours, use of part-time and casual workers, multi-skilling and reduction of rostered days off were among other changes that would be pursued by large and small companies in enterprise agreements. Several of the manufacturers in the current study desired similar changes.

In a review of conditions of work and new work schedules, Thurman (1990) emphasises the divergent positions of workers, unions and employers regarding working-time arrangements. Employers accentuate the importance of the production process, improving customer service, pressures of competition and fluctuations in demands for products and services when advocating flexibility in work schedules, including shortened or extended shifts, weekend and night work. Unions are more likely to insist that inconvenient work schedules be voluntary, and employees prefer schedules to be least disruptive to family and social life.

A number of concerns have been raised in arguments about the advantages and disadvantages of enterprise-based bargaining. Robertson (1992) and Carapellucci (1992) argue that those in part-time and casual jobs in less industrially powerful sectors of the economy (statistically more likely to be women) will have less bargaining power and scope in terms of pay and condition trade-offs to gain work and family benefits in the process.

Several small businesses that relied on less skilled workers made the same point.

'Too expensive. If we did things by the book, we would go under with penalty rates and paid leaves. It doesn't work in his business, anyway. There is a huge pool cif casual labour out there wanting work.'

Kamerman and Kahn (1987) talk about the 'paternalism of small business', which can result from informal and discretionary policy. The quotations throughout this study confirmed the assumption that small business employers see themselves as flexible and accommodating to their employees' family needs, with the accompanying caveat that workers earn and reciprocate what is seen as a privilege or reward not a right.

Towards the Future

The diversity of the entity 'small business' suggests that something other than a uniform response to the provision of support for workers with family responsibilities in small businesses is required. Projections of employment trends signal an increase in part-time, casual and contract work (Wooden 1992; Bartlett 1990). Many of these workers will be employed to service private and public sector organisations that have shed core staff functions. Businesses and government departments are already increasing the amount of 'outsourcing' work to private contractors in both professional and non-professional job categories.

The Business Council of Australia et al.'s (1992) survey of human resource responses to the changing workforce and business environment suggested that employers will manage two workforces: a core staff who will receive increased remuneration, training and some job security; and a peripheral workforce of contracted workers, only some of whom may be considered employees of the company, and who have unstable working conditions and fewer employer-provided benefits. Many new small businesses have been established to fill this 'outsourcing' niche. Protecting the benefits of contract workers has become an industrial concern.

Studies overseas (Miller 1992; Labour Force Canada 1988) and Australia (Romeyn 1992) indicate that employers, particularly in smaller establishments, are more likely to rely on discretionary measures to provide employee benefits that are not statutory. For workers in contract or casual categories, ever fewer benefits are applicable. Comments from small business association groups do not encourage optimism that more generous employee benefits would be forthcoming.

As this review has described, leave provisions and other employee benefits can be costly to employers. Gains in productivity are more difficult to quantify in small business environments because of their diversity. None the less, the employers interviewed frequently mentioned improved staff commitment, morale and willingness to give extra time and do the job well when consideration of needs was reciprocal.

Savings in training and recruitment costs due to retention of skilled women employees who return from maternity leave when child care and flexible working arrangements are provided have been well documented in large corporations (Adie and Carmody 1991; Galinsky, Friedman and Hernandez 1991) and in a United States study of small business (Child Care Action Campaign 1991). Reduced stress and worry leading to improved productivity and decreased absenteeism have also been observed where flexible working arrangements, such as job-sharing and variations of part-time work and flexibility in leave options have been introduced.

While large corporations generally support the proposition that the costs of providing family supports to workers with family responsibilities should be shared among employees, employers and the community or government (Adie and Carmody 1991; Wolcott 1991), the smalI business employers (and their peak organisation representatives) interviewed in this study were less likely to endorse this viewpoint. On the whole, the latter were ambivalent, if not oppositional, to the idea of small businesses contributing to work and family benefits, unless there were trade-offs in the reduction of other business costs. How to achieve a balance in costs and benefits to employers and employees presents a critical conundrum.

Most European countries take the view that provisions for working parents to remain at home with very young children and supports for the continuous demands of family life enhance the wellbeing of the community as a whole. Employers and employees as well as the community at large contribute to the costs through levies and taxes that support national insurance schemes to provide child care facilities and paid parental and sick leave benefits.

Employers benefit from a more productive workforce and a healthy and well-educated future workforce, and communities benefit from increased work productivity and citizens who can contribute to the caring of family members and the community. The provision of family benefits in these countries is based on the premise that men and women are expected to share in paid employment, domestic tasks and child care (Cohen 1991). Research has shown that children and men prosper from the contribution of both parents (Amato 1987).

Given the trends in the structure of employment and the economy described earlier, new ways of working will not be restricted to women in the workforce, but to women and men who will be employed in varying and shifting configurations of full and part-time employment over the life course. As a result, by choice or necessity, women and men will be sharing the earning of income and family responsibilities and require workplace and community supports for carrying out these often competing roles. As Edgar (1992) attests, 'social policies about care have to be closely linked to social policies about work'. He continues: 'Investment in human capital, human capacities to cope individually and collectively with our varied environments would become the language of discourse to replace the exploitative market rationale.'

Small businesses, as part of the community, must share in these costs and benefits in an equitable and fair manner. If small businesses are not able to initiate programs individually, such as child care or elder care programs, they could join together in partnership with other firms in their area and the local community to improve the availability of resources for their employees.

Small business employers, like their corporate colleagues, will have to ensure that their policies related to leave and flexible work arrangements are not subject to bias but are part of more equitable work conditions.

Educating small business employers and employees is essential. Small business development organisations and associations should include information about work and family issues in their publications and trammg programs. Resources are available from many sources, including the Australian Institute of Family Studies and the Work and Family Unit of the Department of Industrial Relations. The Office of the Status of Women has produced a community education kit (Department of the Prime Minister and Cabinet 1992) as part of Australia's response to ratification of ILO 156, to encourage a better sharing between women and men of work and family responsibilities. Small business associations can avail themselves of these resources to educate their members.