Family Matters: Parental Leave as a Long-Term Investment

The arrival of a new child is daunting for any working family. Navigating an unsupportive workplace, though, can be a deal-breaker for employees who are new parents.

Working parents overwhelmingly (90%) would consider leaving their current employer for a job with better family benefits, according to a study from Ovia Health, a family-health benefits platform. The number has skyrocketed in recent years, reflecting a shift in how Americans think about integrating home and work life, Shauna Cour, Ovia Health’s VP of employer sales, told participants in From Day One’s July virtual conference, which focused on giving working families the benefits and flexibility they need today.

The pandemic opened eyes to the types of support that employees feel they need, as parents struggled to balance work, child care and their children’s education all in the same space. To gauge how working parents were coping, Ovia Health surveyed nearly 3,000 people more than a year into the pandemic in 2021. The benefit that working parents wanted most? More paid family leave, the research found.

At first blush, extending parental leave may sound expensive to an employer, but Cour asserted that this is a misconception, and said doing the math shows why. For a hypothetical employee making $75,000 a year and taking three months of paid parental leave and three months of unpaid time off under the Family and Medical Leave Act, the replacement cost is about $56,000. The total includes paid leave, lost productivity and paying a temporary worker, according to Ovia’s calculations.

However, the average cost to replace an employee was one-and-a-half to two times the person’s salary pre-pandemic, or up to $150,000 to replace the person departing from an organization to gain extra family time. The pandemic may have stretched that calculation to three times the employee’s salary, Cour said. “When you really pencil it out, it’s a lot more affordable for you to extend leave,” she said.

A new parent who has had adequate time to prepare for a return to the workplace dives back in with more energy and goodwill. The next step in retaining these workers is ensuring the corporate culture is supportive, Cour said. Reflecting on a time in her career when she needed to sneak down a back staircase to pick up a child from day care, Cour emphasized that managers across the company must do their part to destigmatize parenting accommodations, whether the need is to work from home when a child is sick or to come in late after a doctor’s appointment. “If you've got a really difficult culture, and one that isn’t family friendly, your leave policies don’t matter, right?” said Cour.

Flexible scheduling, hybrid work options, parental resource groups and return-to-work planning are benefit improvements that workers would like to see that can be achieved at minimal cost to the employer. “Some changes can be made without having a ton of budget attached,” she said.

Flexibility can take many forms. The pandemic showed that working from home, en masse, can be successful. Cour advises employers to be thoughtful about what types of new situations, created out of necessity, are continuing to work well. For example, it may be that it’s not always necessary to travel to see a customer, or all meetings don’t need to be in person.

For employees whose job functions don’t allow them to work remotely, there are still ways to offer flexibility. Shift workers can choose their shifts, or be allowed to come in late on a Friday morning. An afternoon off once a month may be an option.

Ovia Health, for example, has incorporated a quarterly well-being day that gives employees some time off simply to focus on themselves. “For me, that has been huge,” said Cour.

The Ovia Health study also indicated that 75% of women have made up their minds before they’ve had the baby about whether they plan to return to their jobs. For expectant moms, a clear picture of what is offered in the parental leave policy and what it will feel like to come back to work are key in making that decision, Cour said.

Helping employees to understand their benefits and locate them when needed is another important but sometimes overlooked way to provide support to a workforce, Cour said. Simplifying the language to make acronyms and terminology understandable, creating a benefits checklist, and getting the word out about resources throughout the year–rather than only during open enrollment–makes signup less of a burden and improves utilization of great benefits.

Editor’s note: From Day One thanks our partner, Ovia Health, who sponsored this Thought Leadership Spotlight.

Susan Kelly is a freelance business writer based in Chicago.