Parental Leave and Small Business – How to Do What’s Best for Your Business AND Your Employees

Small business owners have come to realize that allowing employees to take parental leave is a good policy despite its costs.

It’s a great way to recruit and retain good employees, plus provides these benefits to you:

  • Employees are more likely to return to work after taking time off after having a baby
  • You have the opportunity to cross-train other employees to fill in for a person out on parental leave
  • You can train junior employees to take on new responsibilities
  • It’s an opportunity to take a fresh look at how you distribute responsibilities within your company
  • Generally, employee morale will be higher if you offer parental leave, a fact than can save you money by helping you to avoid frequent turnover

If your company has 50 or more employees, the Family and Medical Leave Act requires you to provide up to 12 weeks of unpaid parental leave. Parental leave is optional for companies with fewer than 50 employees, at least from the viewpoint of federal law. However, your state might have parental leave laws that apply to you. These laws provide job protection for a specified number of weeks when parental leave is needed.

Parental leave is indeed popular – 80% of employees at small companies would take advantage of it, according to the Family and Work Institute. Of course, any paid portion of the leave will only serve to increase its popularity. An interesting statistic is that 91% of small businesses that provide paid parental leave report no noticeable effect on performance and profitability, according to ThinkGrowth.

It makes sense for your company to devise a parental leave policy that meets your needs and those of your employees. Your policy should be included in your employee handbook so that all the terms are understood by all.

The policy should spell out features like:

  • Scope: Under what circumstances can employees take parental leave – maternity, adoption, accepting a foster child, etc. – and whether it applies to both parents.
  • Benefit: How much leave time can employees take, and whether they will be expected to work from home.
  • Pay: How many leave days, if any, will be paid.
  • Notification: How far in advance must an employee request parental leave.

When an employee requests parental leave, a manager or the owner should review the employee’s duties and methods with other employees who will be filling in during the leave period. It’s important not to overload other employees, which might require the hiring of temporary workers. The review process should encourage brainstorming to see whether more efficient methods are available.

It’s a good idea to build relationships with freelancers or staffing firms so that a ready source of temporary labor is available during parental leaves. While employees appreciate the opportunity to take parental leave, they don’t want to be burned out by assuming the work of employees on leave in addition to their own workload.

Employee abuse appears to be rare. Employers should require some sort of documentation for non-obvious (i.e. other than maternity) situations. Employers can add flexibility to parental leave by allowing employees to use saved up vacation days and sick time to provide some paid time during the leave.

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