SOME INFLUENCES OF THE ROMANIAN SOCIAL ASSISTANCE STRATEGY REGARDING THE INCENTIVE BENEFIT ON THE SUSTAINABLE STRATEGIC MANAGEMENT OF ORGANISATION.
The paper focuses on the analysis of the social assistance benefit of parental incentive (monthly incentive, insertion incentive) as a measure of support for the family with children, for the child rearing support. The paper analyses indicators on the amount of this social assistance benefit, the number of beneficiaries of parental incentive (the average number of monthly incentive beneficiaries, the average number of insertion incentive beneficiaries), of those persons who returned to the labour market and benefited from insertion incentive, the number of parental allowance beneficiaries. We believe that these indicators provide a real picture related to the intention of people to return to work despite the extension of parental leave, up to the limit provided by law, which enhances the effects of this insertion incentive--a social assistance benefit with the major role of incitement to the activation on the labour market of the beneficiaries.
If other researches and papers of the authors analysed the impact of insertion incentives on poverty rates (the threshold of 60% of median income per equivalent adult) and severe poverty (40% threshold), by different characteristics of the household (residence, sex and age of household head, structure of the household, i.e. the number of persons in the household, taking or not into account the component of the consumption of agricultural products from own resources, i.e. the own consumption) and other analyses aimed to estimate the impact of this social assistance benefit on income distribution (by quintiles of income, by certain types of families--families with children, residence, employment status of the household head, education level and gender component), in this paper we focused on the analysis of the number of beneficiaries of the incentive provided for childcare. The indicator shows, in a way, how people benefiting from this form of social support perceive the returning to the labour market before the end of the granted child rearing leave. Thus, with sudden and significant increase of the amount of the insertion incentive (a 5 times increase), many beneficiaries actually returned to the labour market. It is true that not only this incentive encouraged parents to return to work before completing the statutory leave period for child rearing; considerations are more numerous, especially when analyzing a variety of perspectives. As we are presently unable to take into account all these perspectives, we believe that because of the yearly increase of the number of people benefiting of this form of social assistance (due to the sudden and important increase of its amount), this incentive can be considered an exciting activation element, stimulating the return to the labour market.
2. Amount of the Parental Incentive and Monthly Average Number of Incentive Beneficiaries
The parental incentive was introduced on the 1st of January 2006 by Government Emergency Ordinance (GEO) no. 148/2005 on family support for child rearing, aimed at improving the socio-economic balance of the family. Through the Social Assistance Framework Law (Law no. 292/2011), the parental incentive is a social support offered to the family for child rearing. The incentive is a financial support for parents who decide to return to work before the end of child rearing leave (according to GEO no. 111/2010 on the leave and monthly allowance for children rearing). When receiving the incentive, the allowance for child rearing is being suspended. Depending on the legislative documents that regulate this social assistance benefit, the quantum of the incentive may be as following:
--Parents with children born before the 31st of December 2011 returning to work before the end of the child rearing leave, received a monthly incentive of 100 lei until the child reached the age of 2 or 3 (in case of a disabled child) (under GEO 148/2005).
--Parents with children born after the 1st of January 2011 that chose to benefit of child rearing leave and allowance for the first year of their child's life and to return to work anytime before the end of this leave, were entitled to receive an insertion incentive of 500 lei until the child reached the age of 2 or 3 (in case of a disabled child) (under GEO 111/2010).
--Parents with children born after the 1st of January 2011 that chose to benefit of child rearing leave and allowance up to two years and return to work anytime during the child rearing leave, were entitled to receive an insertion incentive of 500 lei until the child reached the age of 2 or 3 (in case of a disabled child) (under GEO no. 124/2011).
--Since October 2012, the quantum of the insertion incentive has no longer been differentiated in accordance to the date of child birth, so the amount of the insertion incentive has been established to 500 lei (531,25 lei from the 1st of July 2016, when the amount of the insertion incentive hasn't been connected anymore to the value of ISR, but has been calculated as 50% of the minimum amount of the child rearing allowance).
Reforms on family support for child rearing, aimed at improving the socioeconomic balance of the family, have given a great importance to the labour market return of people benefiting of policies on maternity and child care and rearing. Thus, with a substantial budgetary effort, the incentive's amount suddenly increased significantly, from 100 lei to 500 lei. This important increase also led to the increase of the propensity of persons entitled to benefit from the child rearing allowance that decided to resume their professional activity, which resulted in an increase in the number of insertion incentive beneficiaries.
During 2006-2011 the number of people that returned to the labour market registered both slight increases and slight decreases. Declines were registered during 2008-2010, when increasingly fewer people benefiting of parental incentive returned to the labour market, while the number of parental allowance beneficiaries increased, due to the increase in the amount of this parental allowance, while the amount of the monthly incentive remained at the same value of the previous years (100 lei), thus not offering a strong enough nudge towards employment return. Also, the situation generated by the economic crisis in Romania, with jobs scarcity and uncertainty, was not beneficial to stimulate the return to the labour market. In this context, only 4-5% of the total beneficiaries of this program for family support returned to the labour market in 2010-2011, compared to 9.1% in 2008.
In 2011, there were significant changes in the amount of the incentive compared to the previous year, from 100 lei to 500 lei, which meant an unprecedented increase in the amount of a social assistance benefit, but that amount was differentiated by date of child birth. However, in 2011 the number of beneficiaries of insertion incentive increased slightly compared to 2010 and also the number of beneficiaries of parental allowance, associated to an increase in the share of the people deciding to return to the labour market in the total number of beneficiaries of this family support program. Even if this is not a very massive growth, we must note the beginning of new changes, with an increase in the propensity of beneficiaries that decide to return to the labour market, due mainly to a higher value of the insertion incentive amount. The insertion incentive initiated in 2011 showed its effects in 2012, so its value, much larger than in previous years, has mobilized parents to return to the labour market. The year 2012 came with profound changes on the family support program: after October 2012, the different amount levels of the insertion incentive have no longer been applied, with parents benefiting of a single amount of insertion incentive to return to the labour market (500 lei). This has led to a decrease of parental allowance beneficiaries (with 18.6%), due to the important increase in the number of beneficiaries receiving the incentive (with 83.6%). This unprecedented increase in the number of beneficiaries of the incentive was associated with a very significant increase of the proportion of those who have returned to the labour market, i.e. over 10% of beneficiaries of parental allowance and incentive.
This inertia of the desire to return to the labour market continued in 2013, and the effect even amplified, so that the number of persons entitled to receive parental allowance that made professional incomes subject to income tax increased (a 1.6 times increase, respectively by 63% compared to the previous year of 2012). The sharp rise in the number of the recipients of the incentive, associated to the decreasing of the number of parental allowance beneficiaries, created the context of a very significant share of insertion incentive beneficiaries in total beneficiaries of parental incentive and allowance. This meant that the number of people returning to the labour market was a very important one, and the share of those who have returned to the labour market was high, 17.8% in 2013, which demonstrates the stimulative effect of this social assistance benefit. The years 2014 and 2015 came with relatively large increases from year to year in the number of incentive beneficiaries, due to the increasing of the number of insertion incentive beneficiaries and the decreasing of the number of parental allowance beneficiaries. The share of those who have returned to the labour market was a spectacular one in the 2014-2015 period, exceeding 21% in 2015, which shows the activating effect of insertion incentive for labour market return.
These issues lead us to conclude that the number of parental incentive beneficiaries registered an important increase in the last 5 years, due to the increase of the number of insertion incentive beneficiaries, amid permissiveness of the related legislation and budgets increase, which suggests that this social benefit was a very important element in the parents priorities regarding the labour market return.
Thus, national statistics note that the number of parental incentive beneficiaries has been growing steadily in the period under review, after the sudden and significant increase in the value of the insertion incentive. Thus, the effects of reforms envisaged in terms of social benefits regarding maternity (parental allowance, parental incentive / insertion incentive) that corrected, starting with 2009, some existing inequities (the parent can choose between monthly amounting to 600 lei and 85% of the average income for the last 12 months, but no more than 4000 lei, while in the previous year the allowance was 600 lei, regardless of the income). To this legislative correction, it was added the significant increase in the amount of insertion incentive with the main purpose of incitement to reactivate them on the labour market, and all these have resulted in increasing the number of insertion incentive beneficiaries since 2010. This supports the conclusion that the social assistance benefit related to parental incentive acts as a real incentive element for the (re)activation of its beneficiaries on the labour market, even viewed only in terms of increasing the number of beneficiaries in the last 5 years, as a result of legislative changes that were more conducive to the reinsertion on the labour market. This is one of the clear proofs of the positive effects of labour return simulation policies, increasing the number of persons preferring to return to work instead of benefiting of the extended leave for child rearing.
Also, other international studies analyzed the impact of reforms of child rearing policies, focusing on their impact on the number of people returning to the labour market, and the example of Germany is conclusive. As shown by Bergemann and Riphahn (2010), reforms regarding the maternity social benefits brought important changes from a system of benefits for child rearing with a maximum amount of 300 euros per month for up to 2 years to a system of benefits which replaced 2/3 of the revenues obtained before birth and that are granted for 1 year. Thus, Bergemann and Riphahn (2010) have concluded that "the number of people intending to return to the labour market after 1 year increased by 14%."
Also, other authors have analyzed the impact of policies designed to protect and support persons who benefit from policies of child rearing on their return to work. Thus, Zveglich and Rodgers (2003) consider that "policies designed to protect female workers have controversial effects on labour market outcomes, both in theory and in practice," in the same time, "maternity benefits increase these labour inputs, implying that women value the opportunity to return to jobs they might otherwise have to leave."
Thus, while being in full compliance with these statements, the present paper also outlines two very important conclusions, namely that the insertion incentive is a real tool for encouraging and activating the beneficiaries of support for maternity and children rearing policies and also the fact that the number of beneficiaries of parental incentive who returned to the labour market has been growing since 2010-2011, due to reducing the number of beneficiaries of parental allowance and sudden and significant increase of the amount of the insertion incentive. Not having in reach other scientific tools for analysis, we argue that the increasing of the number of parental incentive beneficiaries could be based only on the important increase of the insertion incentive amount. It is true that this might not be the only factor stimulating the parent to return to work before completing the statutory leave period for child rearing, and the considerations are more numerous, especially when they are viewed from a variety of perspectives. The analyses should be deeper and take into account the perspective of both employee and employer; the employee is regarded as the person receiving legal leave for child care and rearing, thus absenting work for a certain period of time (perspectives viewed also before and during the leave for child rearing) and the employer is regarded as an organization willing to keep its competitive edge, productivity and performance.
The researches of Bencsik et al. (2015) are particularly important, as they focused on analysis of the transfer of knowledge and knowledge management when a member of the organization benefits of maternity leave, and these quantitative and qualitative analysis were conducted both among employees and employers. As everywhere in the world, these are particularly thorny problems for the employee who benefits of maternity leave and could be absent from work for up to 2 years or 3 years in case of disabled children, but there could also be situations where more children are born in the family, in which case the parent could have a maternity leave for 6-8 years, as mentioned Bencsik et al. (2015). This long absence from work could contribute to the deterioration of certain professional knowledge, or to reintegration difficulties, discontinuities in career plan or even career damage, influencing employee motivation and career prospects, etc. At the same time, there might be some thorny problems also for the employers in their continuous fight to preserve market performance.
The specific literature mentions particularly close links between knowledge management KM and human resources management strategies HRM. As specify Haesli and Boxall (2005), mentioning Haesli and Boxall (2005), the human capital is considered "a category of intellectual capital," and this capital is appreciated as a key element in maintaining competitive advantage of the company. So, the strategic management is directly interested in the sustainability of the company in such special situations when it comes to lack of people to work, sometimes for a period of time. According to Bencsik et al. (2015), mentioning Chivu and Popescu (2008), argue that "a modern HRM today has to conform to the requirements of knowledge-based economies and organizations. An employee with knowledge and skills which are useful to the organization means a valuable asset to the organization, and this knowledge may become the main source of its competitive asset."
Also, researches have focused on the fact that an extension of child care leave up to the maximum limit permitted by law, i.e. a maximum duration of child rearing leave (three or more years, certain research even mention 6-8 years), could lead to some difficulties regarding the return to the labour market. Also Bencsik et al. (2015) mention that "this long period of absence clearly deteriorated their chances of any re-integration to their previous workplace" and also, "long absence from work affected the value of their professional knowledge." Also, Bencsik et al. (2015) appreciate that a long absence, with reconciling work and family life could "influence employers decision," when the beneficiary returns to work, sometimes with possible track on short term after returning to work (as the discontinuation of work contract is not permitted during maternity and child rearing leave, according to the law).
Aspects regarding the reconciliation between work and family life abound in the specific literature which combines these goals to salient maternal identity. Voicu (2015), in his analysis, also focused on identifying whether the salience of maternal identity can be regarded as a facilitator factor for resolving conflicts/competition between the two roles, and for the option of employment/job vacancy in mothers with higher education, and explains that there are some "possible tensions arising from conflicts between maternal status-role and professional status-role or lack of professional role, in the case of mothers with higher education." Voicu (2015) has found "that in situations where salient maternal identity is located in the top three positions in the structure of global identity of mothers with higher education, they tend to make better use of time, financial and human resources for the tasks management related to raising and caring for children, both in maternity leave and after returning to the labour market; also the tension generated by the conflict between the two roles was low or even not exist. On the other hand, it was found that salient maternal identity is more common in mothers for whom motherhood is a dimension of feminine identity. Salient professional identity was recorded in cases where the woman parent represents a major income provider for the family (i.e. higher wage or constant salary, stability etc.)." Voicu (2015) concludes that "maternal identity salience facilitates the reconciliation of family and work while the woman parent has the opportunity to choose activities that allow the free, unconstrained maternal role behavior, highlighting the importance of agency and self-determination of women to adapt to the demands of family and professional roles."
Other studies also identify this work and family conflict, highlighting the fact that organisations must have a positive role to play in fostering an organizational culture that helps its staffs balance work and family responsibilities. An efficient strategy of human resource management that is consistent with the demands of these persons may help reduce the workfamily conflict. The issue of work and family conflict was a central objective in the research of Wang and Tsai (2014), which examine the relationship between WFC / work-family conflict and job performance in the nursing context and explores the moderating effects of different sources of social support. Wang and Tsai (2014) highlight the followings: "(a) degree of family-to-work conflict influenced job performance negatively, (b) level of WFC did not significantly affect job performance, (c) support from friends strengthened the negative effect of family-to-work conflict on job performance, and (d) support from coworkers weakened the relationship between WFC and job performance."
Other research studies, through their analyses, recommend some action directions to promote gender equality in terms of compatibility between career and motherhood. So, Dex and Joshi (1999) examine "the economic issues relevant to policy debates that surround the increasing labour force participation of mothers," in term of focusing on the main changes in women's labour market participation in Britain. Also Dex and Joshi (1999) highlighted that "the main source of increase in women's participation rates has come from mothers returning to work after childbirth after progressively shorter intervals." The authors analyze "the major influences on this behaviour and the length of time spent out of work over the first childbirth." They appreciate that "these changes have raised issues relevant to maternity and parental leave, childcare provision, employers' family-friendly working arrangements and children's welfare."
In order to ensure a better harmonization of the relationship between the employee benefiting of maternity leave and the employer who has to continue its activity and keep its competitive edge, the issues concerning the creation, storage, transfer, use and management of the knowledge capital must remain permanently in the sphere of research and many experts are concerned about how, what and whose knowledge can be linked and how such knowledge could be transferred. The literature provides some relevant information about managing this capital of knowledge, considering that the transfer and dissemination of knowledge between individuals and groups within the organization is an important factor leading to improved competitiveness of the company, as Bencsik (2012) also states. Argote and Ingram (2000) adhere to this conclusion. According to them, the transfer and dissemination of knowledge between individuals and groups within the organization is a key managerial element. Thus, the organization has a direct interest in the exchange of knowledge and creating the conditions for a beneficial transfer, in order to continue the activity without barriers, delays or gaps, which would not benefit the organization. This retention of knowledge capital within the organization requires an effort from the company, because they do not have to deal with a loss of knowledge. To achieve this goal, strategic management must play an overwhelming role in this respect and the maturity of the managerial practice, human resources management blended with knowledge management, organizational culture, solutions and replacement solutions must be harmonized to ensure the competitive advantage of the organization and to keep or even improve its market position. When a number of employees retire from their temporary or permanent work (either for maternity / childcare or parental leave, or other reasons such as retirement, unemployment, etc.), or even work in a part-time arrangement, this situation can generate a loss for the company (corporate memory loss) appreciate Makore and Eresia-Eke (2014).
One solution for the management and knowledge transfer within the company seems to have emerged in some organizations. Bencsik et al. (2015), mentioning Lee et al. (2011), appreciate that "most organizations are already considering the necessity of knowledge management strategy building and are already utilizing some of the relevant tools in their work, but only a small percentage of the organizations interviewed by the professional literature claimed that they incorporated this strategy in their long-term goals and their everyday routine." Also, Bencsik et al. (2015), mentioning Hafiza et al. (2013), appreciate "the fact that many companies have no such protocol concerning knowledge sharing can be explained as organizations do not really feel the dangers of knowledge loss due to neglectful knowledge transfer, although they are aware that not all knowledge can be transferred even when the effort is made." Therefore, Bencsik et al. (2015) mention that "the success of knowledge management processes should be based on communication and trust, which would require cooperation between women going on maternity leave and organization." Thus, the sharing and preservation of knowledge and skills within the company is a basic requirement for its existence, which enhances the importance of a continued development of a sustainable strategic management and the HR area is particularly important to preserve and balance the human potential within the organization.
Also, it is irrefutable that the human factor is a major key to the existence, the development, and the performance of the organization, and represents a fundamental force of development. Human capital, like any form of capital, contributes to labour productivity growth, as demonstrated in numerous studies of the scientific literature, including Dumitrache (2015), and Onkelinx et al. (2016), and others. Also, the company's human capital is a key to development and the authors Makore and Eresia-Eke (2014) argue that "literature associates organisational performance with the achievement of strategic goals.... A review of knowledge management literature that concentrates on the knowledge-based theory provides insights and a strong basis to explore the nature and importance of the relationship between knowledge management and organizational performance. The knowledge based theory suggests that the ability to deploy resources successfully depends on the knowledge residing in the human capital of a firm."
As such, the realities and prospects on maternity and childcare are also subordinated to these issues, they should be included in national policies and national strategies in order to be sustained and promoted and they must represent an important human social dimension in the strategic management of the company. Other authors, such as Cenar (2013), focus on the need of including in the organizational policies the component for the protection of maternity and child rearing, especially in the light of the fact that, both internationally and nationally, the demographic situation is in decline. Thus, Cenar (2013) estimates "the need for organisational policies regarding the protection of maternity and child-rearing to be disseminated and clarified to employees since they are employed; a positive attitude of the employers which should demonstrate strategic orientation in amortisation of investment costs in future generations." Other authors also suggest that human resources management must consider comprehensive family-friendly policies and analysed their impact on employees. Grover and Crooker (1995) assessed and analysed the impact of family-responsive human resources policies, such as parental leave, flexible schedules, and child care assistance on organizational attachment. Grover and Crooker (1995) highlighted that "employees who had access to family-responsive policies showed significantly greater organizational commitment and expressed significantly lower intention to quit their jobs. Additionally, child care information referral had a greater impact on affective commitment among employees eligible for that benefit."
These issues have incited analyses and Fitzenberger et al. (2016) have found that "Despite a rising career orientation among females and growing efforts of firms to alleviate work-family conflicts, female employees often find it difficult to combine career development with having children." The paper focused on the return-to-job of female employees after first birth in the case of Germany with long parental leave coverage (3 years or longer). Conclusions of Fitzenberger et al. (2016) show that "more than 50% of those in Parental Leave do not return to their job afterwards. About 31% of female employees return to part-time work during Parental Leave, and among these, only 57% continue working in their job after the end of Parental Leave. And, having returned to their job after the end of Parental Leave, only 81% continue to work in their job one year after return."
Therefore, the management of any organization must pay great attention to these issues regarding temporary absence or limited parental leave or to cases when the person being in maternal leave does not return to work after childbirth. All these issues need to be harmonized as well, both the interests of persons covered by supportive policies and incentives to return to the labour market, while also supported in the care and raising of a child, but also the interests of the employer, through policies that target both their employees as people benefiting from parental leave and child care, but also their own interests to preserve performance and competitive advantage.
Therefore, the analysis and all highlighted results of the present research are consistent with the view that the birth of a child and the experience of the subsequent work-life conflict can create the context of a major reassessment of work preferences among employees benefiting from the effects of policies on maternity and child care and rearing.
The conclusions of these analyses and also of the authors of the present study approach showed that, although an important number of people who benefit from the effects of policies on maternity return to work (either in full time or part-time arrangements), sometimes before the completion of the maternity leave legally provided for raising and caring for children, management must be aware of these issues, considering the period before birth, but also the period provided for maternity, whether shorter or longer, and also the return of these people after a longer stay in the legally stipulated maternity leave for the care and the rearing of a child.
Meanwhile, organizations need to look at knowledge, namely the creation, storage, transfer, use and management of knowledge as a strategic resource and this vision must be translated into a real strategy management, while the emphasis should also fall on the human resources, and the HR / human resources area must also play an important role, especially when considering the harmonization of the organization's objectives of performance and competitiveness with policies of maternity and childcare. So, the authors considered that a special attention should be paid to ensure the harmonization between the KM knowledge management and the human resources management HRM for a sustainable strategic management, which should be beneficial for all involved.
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National Scientific Research Institute for Labour and Social Protection, Bucharest
SILVIA FLORINA COJANU
National Scientific Research Institute for Labour and Social Protection, Bucharest
National Scientific Research Institute for Labour and Social Protection, Bucharest
Table 1 Amount of the parental incentive during 2006-2015 2006 2007 2008 2009 2010 2011 Amount of the 300 100 100 100 100 100 monthly incentive (lei) Amount of the -- -- -- -- 500 insertion incentive (lei) 2012 2013 2014 2015 Amount of the 100 100 100 100 monthly incentive (lei) Amount of the 500 500 500 500 insertion incentive (1 ISR) (1 ISR) (1 ISR) (1 ISR) (lei) Source: Buletine statistice anuale in domeniul muncii si protectiei sociale, Ministerul Muncii si Justitiei Sociale /Annual Statistical Bulletins in the field of labour and social protection, Ministry of Labour and Social Justice, www.muncii.ro Table 2 Monthly average number of parental allowance and parental incentive during 2006-2015 Monthly Payments Monthly average average for parental number of number of incentive (lei) parental parental allowance incentive 1 2 3 2006 11,369 36,172,154 186,342 2007 16,608 23,877,906 189,990 2008 17,928 22,211,145 179,070 2009 14,575 18,716,374 181,405 2010 9,769 12,256,609 196,495 2011 10,288 20,198,058 196,680 2012 18,885 98,023,210 160,028 2013 30,780 189,548,710 142,170 2014 33,659 207,880,985 139,572 2015 37,384 230,358,988 138,350 Total monthly Share of parental average number incentive of parental beneficiaries in incentive and total beneficiaries parental allowance of parental incentive and allowance (%) 4=1+3 5=1/4 2006 197,711 5.75 2007 206,598 8.04 2008 196,998 9.10 2009 195,980 7.44 2010 206,264 4.74 2011 206,968 4.97 2012 178,913 10.56 2013 172,950 17.80 2014 173,231 19.43 2015 175,734 21.27 Source: Buletine statistice anuale in domeniul muncii si protectiei sociale, Ministerul Muncii si Justitiei Sociale /Annual Statistical Bulletins in the field of labour and social protection, Ministry of Labour and Social Justice, www.muncii.ro Figure 1 Evolution of the parental incentive beneficiaries during 2006-2015 2006 11,369 2007 16,608 2008 17,928 2009 14,575 2010 9,769 2011 10,288 2012 18,885 2013 30,780 2014 33,659 2015 37,384 Source: Buletine statistice anuale in domeniul muncii si protectiei sociale, Ministerul Muncii si Justitiei Sociale /Annual Statistical Bulletins in the field of labour and social protection, Ministry of Labour and Social Justice, www.muncii.ro Note: Table made from bar graph.
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|Author:||Stroe, Cristina; Cojanu, Silvia Florina; Ciobanu, Ghenadie|
|Publication:||Economics, Management, and Financial Markets|
|Date:||Sep 1, 2018|
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