If you don’t offer your employees some form of maternity or parental leave, it could cost you in the long run. While many businesses consider maternity leave an added expense, paid maternity leave policies can benefit your company by reducing attrition and boosting productivity and company loyalty.
To avoid losing quality employees, you must understand maternity leave, your responsibilities as an employer and how to develop a fair and comprehensive maternity leave policy.
Traditionally, maternity leave is when a new mother takes time off from a job following the birth of a child. Maternity leave may also begin before the child is born upon the mother’s request.
Maternity leave is also often called “parental leave” as parents of all genders may require time off to care for a newborn or recently adopted child. Depending on state laws and your business’ policy, maternity leave can be paid or unpaid.
Whether it’s mandatory to offer parental leave to your employees depends on your company’s size and the state in which you operate. Under the Family and Medical Leave Act (FMLA), all employees of companies with at least 50 employees are eligible for 12 weeks of unpaid leave each year for things like serious illness, the birth of a child or caring for a family member.
State policies differ on eligibility, length of leave and whether the leave is paid or unpaid. Many states allow pregnancy and childbirth as qualifiers for short-term disability benefits.
“Providing maternity leave increases employee morale, productivity and employee retention,” noted Elissa Jessup, human resources (HR) advisor at the Society for Human Resource Management. “Reducing the high cost of turnover and the associated training costs for new hires are another benefit of an employer providing maternity leave. It can also be used as a recruitment tool to attract and retain quality employees, which can differentiate an employer apart from other competitors who do not provide maternity leave.”
Federal and state laws apply to maternity leave. Here are three laws you should understand.
The Pregnancy Discrimination Act of 1978 is a federal law that protects pregnant employees from discrimination based on pregnancy, childbirth or related medical conditions. Under this act:
The FMLA provides all new parents, including fathers and adoptive parents, with 12 weeks of unpaid leave. The FMLA differs from a business’ maternity leave policy, which is typically six to eight weeks and can be paid or unpaid. However, the six to eight weeks of maternity leave is part of the 12 weeks from the FMLA ― in other words, an employee cannot take six weeks of maternity leave and then start their 12 weeks of FMLA.
The FMLA applies to employees of any company with 50 or more employees who have been employed there for at least a year. Under the FMLA, businesses are required to:
Currently, 12 states and Washington, D.C., have Paid Family and Medical Leave (PFML) programs. These states offer coverage of a portion of an employee’s salary during their time off, ranging anywhere from 50 percent to 100 percent:
Much like the FMLA, these states require employers to give employees time off for parental and medical leave. However, unlike the FMLA, they require this leave to be paid time off. PFML programs have eligibility requirements, such as working a specific number of hours and each state has its own contribution rates and distribution amounts.
Employers in states with PFML programs must contribute or withhold money from their employees’ wages to allow for paid maternity leave.
Paid family and medical leave laws are among the surprising laws that may apply to your small business, depending on your state. Others include mandated workers’ compensation insurance and specific sexual harassment laws.
Besides helping your company avoid discrimination lawsuits, a good maternity leave policy is key for attracting and retaining top talent. Here are six things to do when creating your maternity or parental leave policy.
When you construct your policy, the most important thing is to ensure you comply with state and federal laws. Federally, the most important laws to consider are the Pregnancy Discrimination Act and the FMLA. State laws depend on your business location; if you operate in a state with a PFML program, you are required to provide paid parental leave.
All parents may require leave to care for a child, including mothers, nonbirth moms, fathers, adoptive parents and other caregivers. Every parent benefits from leave policies.
“Employers should have a policy not just for moms, but for all new parents, including dads, nonbirth moms and parents through adoption and foster care,” advised Missy Narula, founder of Exhale Parent and current CEO of Crankstart.
By making your policy inclusive, you help all employees who might have a child come into their lives feel supported and protected.
When creating your parental leave policy, gather input and feedback from various sources, including your HR team, legal representatives and employees who are expecting or have children. Use employee surveys to ask your staff what aspects of a parental leave policy would benefit and help them most, what areas they need support in and what you can do to make the policy the best it can be.
Your policy must be clear and specific on who is eligible for parental leave. You can use the FMLA as a guide. Under the FMLA, employees must have worked for their organization for at least 12 months or 1,250 hours to qualify for 12 weeks of leave. You can adjust the eligibility requirements as you see fit and incorporate state guidelines.
There are three forms of parental leave you can offer:
The FMLA does not require employers to offer paid leave. However, creating a paid leave policy can help you retain valuable employees. Paid leave is a significant benefit many job seekers value highly.
There are a few ways you can offer paid leave:
For new parents, maternity and parental leave is a critical part of bonding with a child and recovering from birth. For businesses, this leave plays a huge role in retaining high-quality employees and improving employee satisfaction. Your parental leave policy will, of course, be tailored to your unique business needs as well as the laws covering your state. But at the end of the day, the facts don’t lie: Parental leave is good for your bottom line.
Natalie Hamingson contributed to this article. Source interviews were conducted for a previous version of this article.