Well before the onset of the COVID-19 pandemic, there was a growing tide of interest and legislative actions to create paid family and medical leave requirements for employers across the United States. The spread of COVID-19 has increased workers' concerns about their own health and that of family members, as well as their ability to care for their children when faced with day care closures and the implementation of remote and hybrid learning programs. Employers struggle with the desire to provide paid leave options to their employees and the challenges of affording them.
In early 2020, LIMRA surveyed 604 human resources decision-makers at U.S. companies with at least 25 employees to understand their attitudes towards paid family and medical leave and their understanding of current or potential legislation. To participate, companies had to be within the private sector and offer at least some non-medical benefits that are either 100% employee paid or the cost is shared between employees and employers.
Current paid leave offerings suggest that many employers are in favor of providing paid leave to help address employees’ needs when they experience certain life changes — especially the birth of a new baby. According to the LIMRA study, maternity leave is the most likely leave benefit companies offer on a paid basis, with 7 out of 10 employers doing so. In addition, most employers (82%) believe that it should be paid.
Medical leave is the second most often offered paid leave benefit with 60% of employers offering it. The largest employers (those with 1,000 or more employees) are significantly more likely than the smallest employers (those with 25 to 99 employees) to offer paid medical leave.
Almost all employers surveyed (96%) said that it is important to take care of their employees and that offering paid leave is the right thing to do (87%). Employers in states without paid family and medical leave laws are somewhat less likely to agree that offering paid leave is the right thing to do (77%).
Most Companies More Generous Than Mandated
About 80% of companies that offer paid family leave report offering it before they were required to do so. In addition, 55% report offerings that exceed the state-mandated levels.
Most often, employers that exceed requirements feel it is important to offer employees rich benefits (53%). Forty-five percent of companies do so to be competitive in attracting and retaining talent.
Despite employers’ generally positive views of paid leave, 1 in 4 express concerns about the associated costs, including their ability to pay the salary of the person on leave as well as the salary of a replacement. Additionally, reductions in staff coverage or realignments of workload may result in lost productivity.
“Employers express concerns about the costs and the complexity of administration and compliance. Carriers can best differentiate their offerings by providing products and services that are designed to better meet employers’ needs, such as leave management administration and a single product for multiple leave types,” said Mary Lesch, associate research director, Workplace Benefits Research for LIMRA.