The Bill & Melinda Gates Foundation recently announced that, effective later this year, it will halve the amount of paid parental leave it offers employees, reducing it from 52 weeks to 26 weeks. The reduction raises the questions: How much parental leave is enough, and how much may be too much?
Too Much, Too Soon
In 2015, the Gates Foundation, a private philanthropy, expanded its paid-parental-leave benefit from 16 weeks to 52 weeks, available after the birth (including via surrogacy) or adoption of a child, wrote Steven Rice, the foundation's chief HR officer, when he announced the change.
Since then, Rice explained, "we have monitored the program and listened to employees—both those who have taken leave and those who have not." Among the lessons learned: "We received feedback and saw in practice that a year away was more disruptive than we anticipated," requiring colleagues or substitute workers to fill in for those on extended leave.
The updated program allows for six months of paid leave and, on a parent's return to work, a $20,000 taxable stipend to help with child care costs and other family needs.
"A growing body of evidence shows that a six-month policy delivers on key outcomes like the health and development of children, gender equality, and women's careers," Rice wrote. "Experts who have studied the connection between the length of leave and ideal outcomes recommend a similar standard."
Finding the Sweet Spot
"More than six months, but less than a year, may truly be the sweet spot in terms of ideal length of maternity leave," according to Working Mother magazine, whose commentary on the Gates Foundation's PTO reduction went on to say:
While we applaud the Bill & Melinda Gates Foundation for giving workers 52 weeks of paid parental leave in the first place, their decision makes total sense if they want to continue running their organization smoothly. Six months is still generous (as reported by the Society for Human Resource Management, in 2016, the average maximum amount of maternity leave offered by companies is 14.5 weeks), and some parents genuinely don't want to take a long maternity leave, for reasons they shouldn't be judged for. But that $20,000 stipend after six months at home? That can help all working parents a great deal by ensuring a smoother transition, and possibly accelerate advancement, which could lead to more money over time.
According to a blog post from Wellable, a wellness and caregiving benefits firm: "Three months may not be enough time for a mother to physically recover from birth. A newborn may not be sleeping through the night yet, making it difficult for parents to be at their best during the workday. In addition, child care is most expensive the younger the child is."
As the Gates Foundation found, however, a long leave can affect women's career advancement opportunities. The Wellable post noted that "some of the larger tech companies (Microsoft, Twitter, Amazon and Apple) think the parental leave sweet spot rests between four and six months. … Google found its ideal PTO in 2007 when it increased maternity leave from 12 weeks to 18 weeks and saw quit rates among new mothers decrease 50 percent."
Parental Leave Is on the Rise
More high-profile companies are expanding paid parental leave. Among recent examples:
- As of Jan. 1, General Mills increased fully paid time off for new birth mothers up to 20 weeks and parental leave for fathers, partners and adoptive parents to 12 weeks, available to salaried and nonunion production workers in the U.S.
- Athletic apparel retailer Lululemon announced Feb. 15 it will offer six months of paid parental leave to all full-time employees who become parents. Employees qualify for three months of fully paid leave after working for Lululemon for two years, and six months of fully paid leave after working at the company for five years. Employees must work 24 hours a week to be considered full time at Lululemon. The company described the policy as an incentive for all employees, from in-store staff to senior leaders.
- Last year, retail giant Walmart expanded its parental leave policy to provide salaried and full-time hourly workers in the U.S. with 10 weeks of paid maternity leave for birth mothers and six weeks of paid leave for other new parents. Walmart's full-time hourly workers had previously received up to eight weeks of maternity leave at half pay, with no parental-leave benefit for fathers or partners.
Overall, more organizations are offering at least some paid parental leave, according to the Society for Human Resource Management (SHRM) 2018 Employee Benefits survey of more than 3,500 HR professionals, fielded in February 2018.
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"Parental leave policies have become a bargaining chip employers are using to attract young talent," said Andy Edeburn, director of customer insights at Jellyvision, a benefits communication tech firm. "The move toward granting more time off for new moms and dads caught fire with tech companies over the last couple of years, but we're starting to see it extend to other industries, even retail."
While a year or even six months of time off is still far beyond what the average company offers, he noted, "expanding maternity, paternity, surrogacy and adoption benefits is high on many employers' to-do lists."
Is a Year Off Workable?
Some paid-leave advocates don't think a year of paid time off (PTO) is too long. "Perhaps if paid parental leave were standard as per a federal policy, workplaces would have an easier time adapting to them," wrote Heather Marcoux, news editor for the website Motherly, an online forum for working mothers. Perhaps, she suggested, "if longer paid leaves were widespread and expected, organizations like the Gates Foundation would find it easier for teams to backfill, flex and thrive while employees are out on maternity leave."
While offering 52 weeks may be too ambitious for some, "Netflix (and, like, every employer in Canada) makes it work, so it's not impossible," Marcoux contended.
[SHRM members-only how-to guide: How to Develop and Administer Paid Leave Programs]
Phasing Parental Leave
Noodles & Company, known for serving up fast, casual pasta dishes, is trying another approach to ease the disruption caused by extended parental leaves. The company is allowing expectant mothers and mothers who have recently given birth to phase out of work and then back in while receiving full salary. Other employers could copy this approach to attract and retain talent, benefits advisors said.
Starting this year, eligible new mothers at Noodles & Company, in addition to receiving six weeks of paid maternity leave, can work an 80 percent schedule during the four weeks before and the four weeks after maternity leave while receiving full pay. The benefit is limited, however, to assistant general managers and above who work full time.
Eligible fathers and other nonbirth parents receive two weeks of paternity/bonding leave.
A Government Push
Several states and municipalities now require employers to provide paid-family-leave benefits, and more are considering doing so. The details differ, but these programs generally require companies of a certain size to provide a significant percentage of the employee's income for six to 12 weeks. The benefits apply only to employees who have been with the firm for a minimum amount of time. Funding comes from some form of payroll or employer tax.
Congressional leaders and the Trump administration are considering making paid family leave a requirement under federal law, although proposals to do so have not moved far in Congress.
Visit SHRM's resource page on paid time off.