Beyond Maternity and Paternity: The Power of a Parental Leave Policy

Only 13% of small businesses with fewer than 50 workers have a paid parental leave policy, according to October 2022 Zippia research. The percentage increases to 26% for businesses with 100 or more employees.

That’s not necessarily surprising. When employees are out on extended parental leave, for example, smaller companies, which often operate on lean budgets, may find it difficult to manage the resulting costs and business disruption.

On the other hand, having a parental leave policy can positively impact employee satisfaction, retention, recruitment and overall company culture. So, for many smaller companies, it may be worth trying to provide at least some level of parental leave benefits. 

Sample Parental Leave Policy

Creating a parental leave policy that fits your unique business and its needs is no easy task. While it is easy to find a sample parental leave policy online, you can’t trust just any policy on the internet, nor can you be sure that it will work for your company and its employees.

Understanding the document and how it can be edited to be a useful tool for your business is different—and this undertaking may require a bit of help. 

In this post, I’ll share a valuable downloadable asset: A sample parental leave policy for small businesses, vetted by our team of HR experts. This sample is specific to companies with 50 employees or fewer—that is, those that the Family and Medical Leave Act (FMLA) likely does not apply. 

I’ll also share a few things to keep in mind as you’re tweaking your sample parental leave policy to make it your own. In the end, you’ll be off to a great start in using your business’ parental leave policies and procedures as powerful recruitment and retention tools. 

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What Is Parental Leave? 

Parental leave isn’t the same thing as maternity or paternity leave. The difference is in who each benefit covers.  

Unlike maternity leave, which traditionally focuses on new mothers, and paternity leave, reserved for fathers, parental leave can be taken by anyone in a parental role – regardless of gender or biological relationship to the child. This leave has evolved to encompass a broader range of caregivers, including same-sex partners, adoptive and foster parents and relatives who may take over caring for a child. It’s more inclusive than maternity and paternity leave are, in comparison. 

Parental leave policies typically recognize the diverse nature of modern families. They are designed to support all employees trying to balance work responsibilities with the demands of parenting. As an example, a parental leave policy could provide time off when an employee’s family expands through any arrangement, not just through the traditional birth of a child. 

Creating a Parental Leave Policy 

A sample parental leave policy can serve as a fantastic jumping-off point for crafting your own internal parental leave policies and procedures. As can looking at your competitors' policies.

But unless you understand how your end product interacts with current federal, state and local regulations, it can be reduced to a confusing piece of paper.

Here are a few key items to keep in mind before you tweak your sample or create your own parental leave policy from scratch:

• Eligibility

  Who is eligible for parental leave (e.g., full-time, part-time, temporary employees) 

• Gender neutrality

  Parental leave policies must be written and implemented in a gender-neutral way. 

  While a compliant policy can set different allowances for primary and secondary caregivers, it cannot differentiate based on gender.

  This means that the words “maternity” or “mother,” and “paternity” or “father” should stay out of it. 

• How much leave

  How much leave is available and how it is calculated (e.g., weeks, days, hours). 

• Paid parental leave, unpaid or a combination

  While the federal government requires certain employers to offer unpaid parental leave, there are currently no state or local laws (as of the time of publishing) that require employers to offer paid leave out of their own pockets. Eleven states currently offer their own state-funded paid family leave programs, which are supported by tax dollars. 

  The decision to offer paid leave is up to your organization and its cultural, recruitment, and retention goals. Small businesses are free to offer paid leave for any amount of time, and they can supplement paid leave with additional periods of unpaid leave as well. 

  Small businesses are also free to pay workers on parental leave at a lower rate of pay than they may receive under normal working conditions. If you allow only unpaid leave or leave paid at a lesser rate, a worker’s time off-duty must truly be “leave”—meaning they should not be asked or encouraged to show up to work, be responsive to calls or emails, or complete any projects for your company.

• Requesting leave

  Clearly outline the process for requesting parental leave and how far in advance it must be submitted. This should include whom to notify (e.g., HR department, direct supervisor), and the preferred method of communication (e.g., email, written notice).
  
  Detail what documentation, if any, is required to support the leave request. This could include medical certificates, expected due dates, or adoption papers.
  

• Job protection

  How the employee’s job and benefits are protected during and after leave.

• Workload management

  Describe how the employee's duties will be managed during their absence (e.g., temporary reassignment, hiring temporary staff). Additionally, you'll want to establish how and when the employee on leave will be updated on work-related matters, if at all.

• Return to work

  Detail the process for reintegrating employees back into the workplace after their leave. This may include phased return-to-work options or flexible working arrangements initially.

Legal Considerations

In addition, keep in mind the following legal considerations: 

• FMLA

The Family Medical Leave Act, or “FMLA,” is a federal law whose parental leave requirements apply to employers who have 50 or more employees. The FMLA requires these employers to permit eligible workers to take 12 weeks of unpaid parental leave. If you have fewer than 50 employees, the choice of whether you will allow parental leave is likely your call to make. 

Keep in mind that the FMLA is a federal law. This means that while no state or locality can create a law that grants employees fewer rights, states and localities can and often do create laws that grant employees more rights, including rights to unpaid parental leave.

To ensure you comply with your state and local laws regarding leave, reach out to an experienced HR compliance expert. 

• Pregnancy Discrimination Act

The Pregnancy Discrimination Act (PDA) of 1978 is an important United States federal statute that was enacted to protect pregnant employees. It is an amendment to Title VII of the Civil Rights Act of 1964. Key aspects of the Pregnancy Discrimination Act include:

• • Prohibition of discrimination based on pregnancy: The Act prohibits employers from discriminating against employees on the basis of pregnancy, childbirth or related medical conditions. This means that pregnant employees must be treated the same as other employees who are similar in their ability or inability to work.

  • Hiring: Employers cannot refuse to hire a pregnant woman because of her pregnancy, as long as she is able to perform the major functions of her job.

  • Maternity leave: The PDA requires that employers treat pregnancy-related leaves the same way they treat other medical leaves. This means providing the same level of benefits, such as sick leave and temporary disability insurance.

  • Health insurance: Benefits provided by employers, such as health insurance, should cover expenses for pregnancy-related conditions on the same basis as costs for other medical conditions.

  • Job security: Pregnant employees cannot be fired, demoted, or otherwise negatively impacted just because they are pregnant, as long as they can perform their job duties.

Businesses with 15 or more employees must comply with the Pregnancy Discrimination Act. 

• Pregnant Workers Fairness Act

The Pregnant Workers Fairness Act (PWFA) is a new law that requires covered employers to provide “reasonable accommodations” to a worker’s known limitations related to pregnancy, childbirth or related medical conditions. More than 30 states and cities also have laws that provide accommodations for pregnant workers and/or workers recovering from childbirth. 

• Publicly Funded Leave

Some states offer publicly funded leave, which is another consideration. Neither Kansas nor Missouri fall within this category, but it’s important to become familiar with and follow applicable laws if your company operates in states where this funding is available. 

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Benefits of Parental Leave 

Most HR experts would argue the benefits outweigh the expenses of offering parental leave. A parental leave policy can positively impact a small business in several ways: 

• Enhanced employee satisfaction & retention

  Employees who feel supported during crucial life events are more likely to stay loyal to the company, reducing turnover rates. 

• Appeal to high-quality job candidates

  In a competitive job market, offering parental leave can be a distinguishing factor. Prospective employees increasingly seek employers who recognize the importance of work-life balance and family support. 

• Positive impact on company culture

  A family-friendly workplace fosters a positive and inclusive company culture. A parental leave policy can make employees feel more valued and appreciated, leading to increased morale and productivity. 

• Opportunity for cross-training & skill development

  Parental leave periods can serve as valuable opportunities for cross-training employees, creating a more versatile and efficient workforce that benefits from ongoing professional development. 

Implementing a parental leave policy is a strategic move that can enhance employee satisfaction and position your company as a desirable place to work. While challenges exist, creative solutions tailored to your unique situation can pave the way for a more supportive and resilient workplace. 

RELATED: How to Help Employees Return to Work After Extended Leave >>

Expert Parental Leave Guidance: Axcet HR Solutions

Ready to elevate your company's approach to parental leave? As certified HR experts based in Kansas City, Axcet HR Solutions is here to guide you. Creating a comprehensive parental leave policy not only enhances your workplace culture but also attracts and retains top talent.

Let our team of seasoned PEO professionals help you navigate the complexities of policy development to ensure a supportive, inclusive environment for all your employees. Don’t wait to make a positive change—contact Axcet HR Solutions today and take the first step towards a more family-friendly workplace!