The Business Benefits of Paid Parental Leave

For the first time since the recession, our nation’s birth rate is on the rise. According to the Centers for Disease Control and Prevention(CDC), a total of 3,988,076 births were registered in the U.S. in 2014, up 1 percent from 2013.

As birth rates increase in this post-recession baby boom, the number of moms and parents in the workforce are also reflecting that growth. Many companies have started to shift and restructure their respective employee parental paid leave benefits. More and more, it’s becoming an asked-after benefit to attract and retain talent.

Leading the pack in this area are companies like Google, IBM, Facebook and Netflix – each have recently upped the ante on their parental paid leave programs. Netflix in August 2015 even introduced an unlimited leave policy for new moms and dads in the name of fostering a culture of “freedom and responsibility.”

Here at H+K, we have also been recognized as a leader in the PR industry for our generous leave policies.

“We’re hoping to set a precedent for other companies to follow with an industry-leading parental leave program, which allows 16 weeks of fully paid leave for birth moms and 10 weeks fully paid for dads, partners or adoptive parents,” wrote H+K president and CEO of the Americas region, Michael Coates, in a recent OpEd published in the Huffington Post.

Updating family leave policies demonstrates a company’s ability to listen to its customers as well as its employees, a purpose-driven approach that looks to not only increase profits but shared value as well.

Today, the United States is the only developed country that doesn’t guarantee paid parental leave for employees who become new parents, according to research conducted by the Institute for Women’s Policy Research (IWPR). Last year, after the Obama administration’s push to rectify this, the issue has picked up steam and continues to make headlines.

However, not everyone agrees that mandating family-friendly paid leave should be an essential part of company culture. “I’m not saying I oppose paid maternity leave,” said former Republican presidential candidate Carly Fiorina in an interview last fall with CNN’s Jake Tapper on State of the Union. “What I’m saying is I oppose the federal government mandating paid maternity leave to every company out there.”

According to the U.S. Department of Labor, as of 2012, nearly 60 percent of American employees worked at companies that were covered under the Family and Medical Leave Act (FMLA) of 1993. Although FMLA safeguards employees from losing their jobs due to maternity leave, lower-income workers can’t always afford to take unpaid time off. The debate heating up is around whether it’s “right” for employees to have to choose between taking care of their children or taking on financial strife, and if it shouldn’t have to be a choice, then whose responsibility it is to provide this added financial security?

Amidst the debate, companies of all sizes across the country are making significant strides toward expanding paid parental policies for both purpose-driven and business-oriented reasons. Top reasons include:

Infant Health Advantages

Research shows that newborns thrive when mothers are at home for longer periods of time, especially during an infant’s first year. A 2011 study shows that an increase of 10 full-time-equivalent weeks of paid maternal leave was associated with a 10 percent lower neonatal and infant mortality rate and a 9 percent lower rate of mortality in children younger than 5 years of age.

Improves Productivity

Maintaining a happy and healthy work-family balance is crucial for some employees. In fact, it can boost productivity. Knowing that an employer supports family planning can result in increased focus and dedication from employees. “Experience shows people perform better at work when they’re not worrying about home,” wrote Tawni Cranz, Netflix’s Chief Talent Officer.

Boosts the Bottom Line

It’s no secret that employee turnover costs companies big bucks; so employee retention is crucial to a company’s bottom line. Replacing employees earning $75,000 or less, costs roughly 10-percent to 30-percent of that individual’s annual salary, according to a survey conducted by the Center for American Progress. Those numbers show that ensuring that employees return after parental leave is a valid concern—making substantial parental leave benefits a great incentive for businesses.

The health advantages for newborns, improved productivity due to healthy work-life balance, and a boost to the bottom line through employee retention makes paid parental leave a win-win for businesses and the people who run them.

by Magnify Team | February 20, 2016 | posted @

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