As NICU Cases Rise, Laws and Employers Look to Assist Working Parents

On Jan. 1, Colorado became the first U.S. state to mandate paid leave for parents to care for a newborn who has been admitted in a hospital’s neonatal intensive care unit (NICU). Colorado’s new law, applicable to employers with at least one employee, includes up to 12 added weeks of leave after the worker has utilized benefits under the state’s Family and Medical Leave Insurance (FAMLI) program. As a result, employees may be eligible for up to a total of 24 weeks of paid leave (12 weeks of base bonding leave and, if needed, 12 weeks for additional time that the newborn is in the NICU).

On June 1, Illinois also will implement its version of a NICU leave law, providing protected, unpaid leave for parents with a child in a NICU. This law is applicable to employers with 16 or more employees.

According to data from the U.S. Centers for Disease Control and Prevention (CDC), 9.8% of U.S.-born babies are admitted to a NICU after birth — a steady rise from 2016, when the percentage was 8.7. These newborns typically need specialized, around-the-clock care due to prematurity, low birth weight, breathing problems and/or other serious conditions, usually requiring advanced medical technology and a trained staff.

Given that, highly stressed working parents of babies in the NICU are often faced with a scenario that requires an extended post-delivery workplace break. Additional time off without losing employment for these parents has now moved from a “nice to have” employee benefit to one of critical importance.

“No one plans for a NICU stay. It is an emotional rollercoaster. … An employer that proactively provides NICU leave shows a commitment to the health and well-being of the family, and is never forgotten by those impacted by the experience.”
— Erica Vanni, absence consulting lead, American Benefits Consulting

A Growing Benefit Trend

While some employers currently offer their own NICU-related leave, the momentum behind this benefit has accelerated significantly in the past few years, said Jeff Nowak, a shareholder and co-chair of the leaves of absence and disability accommodation practice group at the Littler Mendelson employment law firm.

He noted more employers are expanding their parental leave policies to specifically address the needs of parents with infants in NICU, reflecting a broader shift toward more comprehensive and compassionate support for working parents.

Nowak said employers should clearly communicate their personnel policies in terms of how employer-provided NICU leave impacts other leave laws (including those implemented by states and by the federal government under the Family and Medical Leave Act [FMLA].

“From there, employers should establish verification procedures compliant with state and local law,” he said.

While Nowak considers Colorado’s law a “bold, comprehensive approach,” he said Illinois has taken a somewhat different path, implementing a job-protected NICU leave law that covers a wide range of employees, including those not eligible for FMLA benefits. No minimum length of service or hours worked with an employer is required under the Illinois law, as compared to the FMLA, which requires at least 12 months of employment with an employer and at least 1,250 hours worked in the past 12 months.

In addition, employers should consider and define who is a qualified family member for NICU leave, said Erica Vanni, the absence consulting lead at advisory firm American Benefits Consulting.

As caregiving duties have expanded to other family members, there is a delicate balance between time off policies and business needs, she explained; therefore, organizations that implement NICU leave should ensure the policy is accessible, compassionate and supported at all levels.

“No one plans for a NICU stay,” Vanni said. “It is an emotional rollercoaster. … An employer that proactively provides NICU leave shows a commitment to the health and well-being of the family, and is never forgotten by those impacted by the experience.”

Holistic, Carefully Considered Strategies

NICU leave can include extensive or at least partial time off to care for the newborn, in addition to address any medical needs NICU babies may face at home, said Lindsay Bower, a senior principal of health and benefits at consulting firm Mercer.

“We are seeing some employers approach their pregnancy and postpartum strategies with holistic, careful consideration, which can include flexibility in leave policy design,” she said.

It’s also important for organizations to consider what their paid leave policies say about their core values, said Rich Fuerstenberg, Mercer’s senior partner of health and benefits.

“Employers may offer generous paid time off allowances with the expectation that employees can use that time for a broad range of life events, but [NICU leave goes above and beyond],” he said.

Nowak added many employers view these benefits as critical tools for supporting families, improving health outcomes and retaining talent in an increasingly competitive labor market.

“The recent legislative activity reflects growing awareness as NICU admissions rise and as research continues to show the importance of parental presence in neonatal care,” he said.

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