Why Paid Parental Leave is Good for Business

With employee needs evolving in the changing world of work, employers are re-examining the definition of work-life balance – and with it, their policies. Parental leave policies have been an especially hot topic of discussion lately. At Ceridian, we believe that employees should be able to spend time with their families while feeling confident that their jobs will be there when they return to work. That’s why we recently updated our policy to provide extended, fully-paid parental leave.

Ceridian previously had the traditional leave policy that a lot of U.S. employers have, which was paid with short-term disability and personal days off, with the remainder of the time unpaid. As an employer, we wanted to make work-life balance better. This meant updating Ceridian’s parental leave policy to provide 14 weeks leave paid at 100% salary for the primary caregiver and two weeks paid leave for the secondary caregiver.

This change came from listening to our employees and looking at global parental leave policies, and then exploring what Ceridian as an organization could do to support its employees. With other countries offering multiple weeks of paid leave – Estonia has up to 89 weeks of paid leave, for example – it made sense to look at the U.S. average and look for areas of improvement.

We believe updating Ceridian’s parental leave policy is so important because it contributes to leading the charge in creating a new paid parental policy for new, foster or adoptive parents. A recent PEW Research Center report found that while both parents work in nearly half of two-parent households, the United States is the only country among 41 Organization for Economic Cooperation and Development (OECD) nations that does not mandate any paid leave for new parents, according to data compiled by the OECD.

States like California, New Jersey and Rhode Island have state-mandated paid leave plans and the US federal government administers the Family and Medical Leave Act (FMLA). FMLA “entitles eligible employees of covered employers to take unpaid, job-protected leave for specified family and medical reasons with continuation of group health insurance coverage under the same terms and conditions as if the employee had not taken leave.”

The process of updating Ceridian’s parental leave policy required a real understanding of how to balance the needs of family life with work. We began with a few small changes, but that wasn’t enough. Looking at market competitiveness, we needed to move to something that was broader, fully paid and more inclusive of all types of families, including same-sex relationships.

An important adjustment we made was in taking both the primary (more than 80% responsibility for the child immediately following birth, adoption or fostering) and secondary (less than 20% responsibility) caregivers into account as part of our policy. Most parental leave policies define the mother as the primary caregiver, but with Ceridian’s policy, the mother can be defined as primary or secondary. Family comes in different forms and we are proud to support that. We feel that it’s light years ahead of what a lot of other employers are doing.

While the average in corporate America is 10 weeks of paid leave, we found that our employees are out for the full 12 weeks as allowed by the FMLA. We thought, “Let’s not only meet that but exceed it.” That’s why a primary caregiver gets 100% of their base salary for 14 full weeks. The secondary caregiver gets two weeks, fully paid, which must be taken within the first 12 months of the child’s arrival into the family.

The feedback has been positive since we implemented the policy in 2016. If both parents want to be home together for two weeks, there’s no worry about how they’re going to pay the bills. I love the fact that they can take those weeks for child bonding and we’re doing something to aid that process. They come back much more committed to us because we’ve given them that opportunity to spend time with their family.