Will You Be the Last Kid on the Block to Add Paid Parental Leave?

Will You Be the Last Kid on the Block to Add Paid Parental Leave?

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Will You Be the Last Kid on the Block to Add Paid Parental Leave?
Calendar22 October 2018

Paid parental leave has gone main-stream, according to a new Mercer survey on absence and disability management. In 2018, 41% of survey respondents offer paid parental leave to their employees, up from only 25% of respondents to our 2015 survey.

While paid parental leave is almost always made available both to birth parents and non-birth parents, survey results show that birth parents tend to get more time off than non-birth parents. The median amount of leave offered to birth parents is six weeks, compared to four weeks for non-birth parents. The length of leave offered is unchanged from the 2015 survey. So while more employers are offering leave, the amount of leave being offered hasn’t increased noticeably, despite a few well-publicized exceptions (like the 4 months offered by Facebook to parents of either gender).

Survey results also suggest that more employers are offering leave for the adoption of a child -- 38% of respondents in 2018 provide this type of leave, up from 24% in 2015. The median allowance of 8 weeks for adoption leave has also remained unchanged.

Employers recognize that a new addition to the family is just one of many life events that cause employees to need additional paid time off. Most respondents allow employees to use their own paid sick days to care for a sick family member (82%, up from 74% in the 2015 survey). And 19% of respondents offer company-sponsored paid leave to care for a family member with a serious health issue; the median allowance is 8 weeks.

New statutory paid leave mandates enacted at the state and local level may be a factor driving the increase in paid parental and caregiver leaves. Understanding the interaction between the design, administration and cost of state leave laws and employer policies is an increasing challenge for employers of all sizes, creating both risks and opportunities. We recommend employers take the following actions:

  • Review existing leave policies for alignment with statutory mandates. 
  • Revisit paid leave policies. The survey provides new benchmarks that are worth considering. Employers in some industries may now stick out if they do not have a paid parental leave policy – and that may not be a distinction you want. In addition, new and enhanced statutory benefits can materially reduce employer costs.
  • Take stock of changing administration requirements. For employers that administer leaves in-house, what is the statutory straw that breaks the proverbial camel’s back? For employers that outsource their leave programs, can your current administrator handle all the changes on the horizon?

Mercer’s 2018 Survey on Absence and Disability Management was fielded March-April and 423 employers participated. The survey covered broad range of topics, including absence management strategies, paid-time off plans, leave administration, and disability plans. A full report on the findings is being prepared, but we will continue to post articles on selected findings here in the meantime. Contact rich.fuerstenberg@mercer.com if you have questions.

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