4 parental leave questions employers must answer
Before changing a policy for new parents, benefits leaders need to consider what to call the program and how to pay for it
Broad paid parental leave policies have expanded significantly throughout the United States as part of an overall movement toward family-friendly benefits. And many expect it to grow even more.
However, what makes for a sound practice can be complicated to implement. Before employers undertake any desired parental leave enhancement, they must address four key questions to ensure success. 1. What should we name the leave?
The U.S. Equal Employment Opportunity Commission’s Enforcement Guidance on Pregnancy Discrimination and Related Issues, which prohibits discrimination based on gender, has opened the door for lawsuits alleging that certain paid parental leave programs that don’t offer equal time off policies for both parents are discriminatory. It says, “employers should carefully distinguish between leave related to any physical limitations imposed by pregnancy or childbirth (described … as pregnancy-related medical leave) and leave for purposes of bonding with a child and/or providing care for a child (described … as parental leave).” In other words, companies must name leave carefully and specifically to avoid legal disputes.
2. How should we pay for and administer the leave?
There’s a growing understanding among employees, and now employers, that birth mothers do not consider a routine pregnancy and child- birth as a “disability.” In response, some employers are taking a closer look at their disability plans, specifically their treatment of claims for pregnancy and childbirth. Employers should take the maternity benefit out of the disability plan and make it entirely separate, or create a separate class for birth mothers within the STD plan to provide a richer benefit to new mothers.
3. How do we implement leave across different locations? Currently, four states mandate paid parental leave (California, New Jersey, New York [in 2018] and Rhode Island), as do many other cities and municipalities. It is anticipated that this legislative trend will continue, as President Donald Trump has pledged to implement some form of national paid family leave. Thus, employers should comply with the laws in the cities and states in which they operate. Employers should also consider the parity of their benefits if they operate in locations that mandate paid leave as well as locations that do not.
4. How can we create an inclusive policy?
The movement toward more family-friendly workplace policies has raised the inevitable question of paid leave to care for other family members, not just children. Many believe that a broader paid leave for specific family care is a practice whose time is coming, and companies may look at designing a more encompassing approach. Benefits leaders should consult with internal partners, including legal resources, to consider whether a parental leave program or a broader family leave program is the most appropriate approach for the organization, both culturally and financially.
Patricia Purdy is a benefits practice leader and consultant with more than 20 years of experience. She works for benefits firm Pacific Resources.