Businesses Add Parental Leave Programs While Congress Sits
Workspan Daily
January 11, 2022
Key Takeaways

  • A competitive issue. More workers are making paid parental or family leave a must-have, not just a nice perk, in a competitive talent war.
  • Broadening traditional parental leave. Expanding paid family leave for different caregiving needs strengthens diversity, equity and inclusion (DEI) efforts and employee retention.
  • Inclusion of blue-collar workers. More family leave is being offered to employees in lower-wage industries, such as Publix's recently announced program which offers a maximum of six weeks of fully paid leave.
  • Awaiting a decision. President Biden's proposed Build Back Better Act, which includes four weeks of paid parental leave, is currently languishing in the Senate.

While a watered-down parental leave proposal stagnates in Congress, more businesses are offering expanded leave benefits to a wider range of employees.

Family leave proponents point to a couple of key reasons for the trend — the COVID-19 pandemic literally brought home the need to help caregivers while paid leave became a necessary weapon in the war for talent as well as a way to instill an organization’s brand.

“There has been in increase in the past two years as companies feel the impact of not having it (paid parental leave) and the desire for employees to have it,” said Amy Beacom, Ed.D., CEO of the Center for Parental Leave Leadership. “The pandemic laid the base for the need. There is no longer an illusion about the need for it.

“There is no way people can work and caregive the way businesses are structured,” said Beacom, who published a paper on parental leave in a recent Journal of Total Rewards. “Companies are losing people left and right.”

During the Great Resignation, more than 13 million U.S. workers quit their jobs in September-November. One main reason is caregiving responsibilities.

Yet, just an estimated 25% of U.S. businesses offer paid parental leave while the United States remains the only industrialized nation not to mandate it. Thirteen states mandate some form of paid parental or family leave.

Large businesses are the most likely to offer parental leave benefits. Look at Willis Towers Watson’s 2021 “Well-Being Diagnostic Survey,” where 86% of respondents who offered parental leave benefits employed 1,000 or more. The survey found that 77% of respondents plan to have parental leave in place in 2022 with 45% offering other child care support; 43% elder care; and 37% other paid caregiver leave.

Necessity, Not a Frill

More workers are making paid parental or family leave a must-have, not just a nice perk, said Brad Harrington, Ph.D., director of Boston College’s Center for Work & Family.

“With the war for talent, it’s become a competitive issue,” Harrington said. “People are beginning to look for it — dual career couples, single parents, men who are becoming more involved in caregiving.

“Lots of businesses say they can’t afford it. What they are really saying they can’t afford to be competitive.”

He began seeing growth in family leave programs about six years ago. In a 2014 study, Boston College’s Center for Work & Family found that very few businesses offered paternity leave.

“Right after the report, companies started looking at gender-neutral policies,” Harrington said.

In later studies, the Center has found men’s and women’s concerns about taking parental leave are similar. For example, 59% of women were concerned that taking leave would delay their career advancement compared to 49% for men.

“There is not nearly as big a discrepancy as we thought,” Harrington said.

He pointed out that business-instituted plans can reduce the hesitancy to take leave that can come with government-mandated programs.

“When a corporation is endorsing a program, employees are more likely to take it without fearing repercussions,” Harrington said. “Most corporations pay 100% (of salary during leave), while state mandates are usually in the 50-60% range. So with state programs, there are real financial issues new parents need to consider.”

Building the Brand

Instituting a parental leave program can boost an organization’s brand, the experts agree.

Not having a leave program constitutes “an undesirable public health component,” Beacom said. “It’s not a good brand to have your employees coming into work when they are sick because they have to. Businesses need to create a brand that is caring.”

Family leave is “part of (an organization’s) cultural fabric and DNA. It shows ‘we care about people,’” concurred Jackie Reinberg, Willis Towers Watson’s North America leader for leave management.

Expanding traditional parental leave, which covers parents of newborns, to more expansive leave programs not only builds that caring brand, she says, it also strengthens diversity, equity and inclusion (DEI) efforts and employee retention.

“Not everyone is in that (new parent) situation,” Reinberg said. “With different stages in a lifecycle, there are different caregiving needs. Paid family leave is much broader. It’s for people to care for loved ones, including nontraditional families. It flows into other areas such as bereavement leave.

“With DEI, you think of the well-being of employees throughout the entire lifecycle. With DEI we are seeing the edges (between parental and family leave) blurred.”

While such an inclusive program can carry a big price tag, it provides big results in such areas as employee attraction and retention, she said.

When witnessing a family leave program in action, people are going to think “This is an organization that is going to support me through the stages of my life,” Reinberg said.

Three-quarters (75%) of respondents to a 2019 Boston College survey agreed that they would be more likely to remain with their current employer because the organizations offers expanded parental/family leave. In addition, 30% of respondents reported an increase in loyalty to their employer compared to 13% who reported a decrease. That net increase in employer loyalty was more pronounced for men (27%) than for women (12%).

Benefits to Blue-Collar Workers

Leave programs are beginning to become more prevalent in lower-wage industries in the retail and service center, as illustrated by Publix Super Markets Inc.’s December announcement of parental leave benefits.

“It’s a positive sign that organizations are offering it to lower-wage, blue-collar earners. Usually, it’s just been for white collar like the financial sector,” Harrington said.

Both full- and part-time Publix workers are now eligible for paid parental leave with the birth or adoption of a child. The company will pay at least two weeks of an employee’s average with more depending on length of service and whether the employee is full or part time, salaried or hourly. The maximum is six weeks of fully paid leave.

Publix has 1,294 stores with 225,000 employees. According to its website, it is the largest employee-owned company in the United States.

“We frequently review our benefits to continually offer a comprehensive package to our associates,” Publix spokesperson Maria Brous told Florida Politics.

Several grocers have acted to make is easier for parents to continue working or return to the workforce. Grocery employee are, of course, among frontline who can’t work remotely. For example, Hy-Vee teamed up with WeeCare to provide eligible workers access to in-home providers in both rural and urban areas. Several grocers have emphasized their child care benefits in their attempts to attract workers.

Publix is a somewhat unlikely company to adopt paid family leave. Although consistently ranking high in “best places to work” surveys, Publix in 2018 had the worst score for leave policies, according to PL+US, a nonprofit organization that advocates for family leave.

Congressional Gridlock

Congressional Republicans have been unanimously opposed to President Biden’s proposed Build Back Better Act, which includes four weeks of paid parental leave (down from the original 12 weeks). That legislation barely passed the House of Representatives in November with no Republican votes.

Now it is languishing in the Senate, which is split 50-50 along party lines. Sen. Joe Manchin (D-W.V.), who has been brokering his swing vote, has expressed opposition to the paid family leave portion of the Build Back Better Act. No Republican senators are expected to vote for the measure.

Family-leave proponents are clearly not waiting for Congressional action.

Publix’s actions “speak to the bipartisan nature of family leave,” Beacom said. “It is horrible that it is caught up in politics.”

Reinberg points to a dozen-plus state and local proposed parental leave-related mandates but predicts “employers will continue to take the lead in this space.”

“I’ve been involved with this for 21 years,” Harrington said, “and I learned not to wait for the government but to go to the corporations.”

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