Step Up to Paid Parental Leave

Here’s a quick question for you: What do Papua New Guinea and the United States have in common?

They’re two of the three countries left in the entire world that still do not guarantee paid maternity leave.

Thankfully, major employers like Netflix, Adobe, Microsoft and Google are stepping out of the Stone Age — and stepping up to the plate — by radically improving paid leave for parents.

Netflix: In August, Chief Talent Officer Tawni Cranz announced the company’s decision to introduce an “unlimited maternity and paternity leave policy.” The change allows moms and dads to take off as much time as they want during the first year after a child’s adoption or birth.

Adobe: A week later, Adobe announced plans to double its paid maternity leave to 26 weeks and increase its paid paternity leave to 16 weeks.

Microsoft: Starting in November, Microsoft employees will get eight more weeks of paid maternity leave for a total of up to 20 weeks of paid time off (nonbirth parents will be able to take up to 12 weeks of paid leave). In addition, they’ll also allow birth mothers to start their leave two weeks prior to their due dates and give new parents the option of phasing back into work on a half-time basis.

Google: A true pioneer in the paid parental leave revolution, the tech giant bumped its paid maternity leave to 18 weeks (up from 12) back in 2007.

Among U.S. employers, these businesses are leading the pack in revolutionizing paid leave policies.

Why are they doing it?

First of all, it makes good business sense.

It promotes retention. In our Mom Corps 2013 Workplace Study of U.S. working adults, we found that 39 percent of adults have considered leaving or left a job because it wasn’t flexible enough. In addition, 73 percent of working adults said that flexibility is one of the most important factors considered when looking for a new job.

Google provides further proof of the retention benefits paid leave provides. In the eight years since it bolstered its paid maternity leave policy, it has seen the rate at which new moms leave the company fall by a whopping 50 percent.

It's simple, really. Flexibility encourages loyalty. Employers that step up to the plate and improve their maternity and paternity leave policies keep top professionals longer — and get more out of them.

It’s good for morale. Ninety-nine percent of employers responding to a California study on paid leave reported a positive or neutral effect on employee morale. Likewise, the Center for Economic and Policy Research’s study of New Jersey employers reported marked reductions in employee stress levels, as well as improvements in morale — of those who take paid leave as well as their co-workers.

It’s a great recruiting tool. In a tight talent market, offering paid leave builds your credibility as an employer of choice — and makes you a magnet for a more diverse group of professionals looking to grow long-term with an organization. When you think about it, it makes sense. Great people want to work for great employers who “get it” when it comes to flexibility.

It builds a healthy bottom line. Despite the increased cost, paid parental leave does not necessarily hurt businesses. By facilitating bonding, recovery and return to work — without imposing undue financial hardship — employers can save huge amounts of money in absences, health care costs and turnover costs.

Furthermore, an environment in which employees experience fewer work-life conflicts fuels exceptional performance. As Netflix’s Cranz said in her blog post, “Experience shows people perform better at work when they’re not worrying about home.”

It’s a national economic priority. Providing paid leave is more than just a “nice perk” for moms. Economists have found that paid leave increases the likelihood that mothers will return to their jobs, work more hours and earn more money. That’s good for everybody.

Secondly, paid leave legislation is on the verge of radical change.

President Obama is trying to make paid leave national policy, calling on Congress, states and cities to adopt paid leave policies in his 2015 State of the Union address.

The Family Act, the Healthy Families Act and the Federal Employees Paid Parental Leave Act, while helpful, are woefully inadequate when compared with the policies of other developed nations.

Four states (California, New Jersey, Massachusetts and Rhode Island) already have publicly funded maternity leave, and more are likely to follow suit.

 Companies like Netflix and Adobe see the writing on the wall and want to stay ahead of policy changes. In addition to preempting compliance issues, these employers are revolutionizing their paid leave policies to retain their best people, recruit top-notch talent and create a source of competitive advantage that’s sure to make shareholders smile.