Employers Use Tech to Manage Leave

Complying with local leave laws is among HR's top challenges

Stephen Miller, CEBS By Stephen Miller, CEBS March 3, 2020
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Employers Use Tech to Manage Leave

Most large U.S. employers are adding or considering new types of paid leave, increasing the number of days available for leave, and broadening eligibility for taking leave, a new study shows. Other research highlights the different kinds of technology employers are using to manage paid and unpaid leave.

Paid Leave on the Rise

According to a survey by the nonprofit Business Group on Health, employers are responding to employees' needs and a more diverse workforce by expanding paid leave for parenting, caregiving, bereavement and other reasons.

The Business Group's 2020 Large Employers' Leave Strategy and Transformation Survey found:

  • 30 percent of respondents added new leave programs in 2019, 24 percent are planning to add programs in 2020, and 18 percent are considering new programs in 2021 or 2022.
  • 24 percent increased the lengths of leave available last year, 23 percent plan to increase the lengths of leave in 2020, and 23 percent are considering doing so in 2021 or 2022.
  • 12 percent expanded eligibility for leave benefits last year, 8 percent plan to expand eligibility in 2020, and 15 percent are considering doing so in 2021 or 2022.

The survey was conducted in October and November 2019 and gathered responses from 113 large employers, most with more than 10,000 employees.

"Employee well-being is a top area of focus for employers," said Brian Marcotte, the Business Group on Health's president and CEO. "Employers are investing in leave benefits as part of a more holistic view of the role employee well-being plays in workforce strategy."

Leave benefits, especially for new parents and working caregivers, he added, "are highly valued by employees and address a growing area of need. Employers are evaluating and in many cases expanding these and other benefits to help meet those needs."

More Support for Caregivers

Employer interest in supporting employees with caregiving responsibilities is growing, as well. Over one-third of respondents (35 percent) offered caregiver leave benefits, and another 28 percent are considering adding them by 2022.

Many employers have gone beyond offering leave to care for a spouse, child or parent to also covering leave to care for others employees may have caregiving responsibilities for, the survey found. In particular, 46 percent of respondents with caregiving benefits offer leave to care for siblings, 46 percent offer leave to care for parents of a spouse or partner, and 38 percent offer leave to care for grandparents.

All respondents said they offered bereavement leave. On average, employers offered six days of bereavement leave, with some providing up to 20 days.

"We expect large employers to continue expanding leave benefits in the coming years, and not just for parents and caregivers," said LuAnn Heinen, vice president of the Business Group on Health. "Employers are looking to provide volunteer leave, bereavement leave, military leave, mental health days, and summer Fridays off. Employers see their roles changing and want to support employees during the times they need it most."

[SHRM members-only how-to guide: How to Develop and Administer Paid Leave Programs]

Leave Administration Challenges

More respondents identified state and local leave laws as their greatest challenge in absence management, more so than employees' experience with the leave process, lack of resources and business continuity. 

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Most large employers surveyed (70 percent) were in favor of a federal paid-leave law if it supersedes state and local laws and creates a uniform process for reporting and compliance.

Leave Management Tech

HR and benefits professionals are using various types of software platforms to manage leave, according to a 2019 survey by the nonprofit Disability Management Employer Coalition (DMEC) and Spring Consulting Group. More than 873 U.S. employers of all sizes responded to the survey.

The use of technology to administer leave, including unpaid leave under the federal Family and Medical Leave Act (FMLA), increased with employer size, the survey found. Smaller employers (55 to 99 employees) are more likely to use payroll systems to administer leave, while larger employers tend to use specific leave-management software.

ADP was the most commonly used software by employers managing leave for fewer than 1,000 employees, and Workday was most often used by employers with 5,000 or more employees.

Among respondents that use leave administration technology, the most common uses of the tools were:

  • To determine leave eligibility (81 percent).
  • To run standard reports (66 percent).

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Karen English, senior vice president at Spring Consulting Group, advised checking vendor directories to evaluate leave management systems and compare the different types of functions these programs perform. DMEC offers a directory of technology providers, as does the Society for Human Resource Management.

"Look at what each of the systems is able to do, depending on what you need them to do—such as the ability to determine leave eligibility—and consider the different leave types you might be managing," English advised.

Among other key points to consider, she recommended, "make sure that there are letters or templates within the systems that you can draw from, and understand what kind of support is provided for managing reports."




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