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Corporate Counsel Connect collection

October 2015 edition

Employee benefits "arms race:" What extended parental leave policies mean for your organization

Jeremy Byellin, JD

Jeremy Byellin Extended parental leave policies are becoming increasingly popular among many employers, with more companies looking to jump on the bandwagon every day. For example, in August, Netflix announced its new "unlimited leave policy for new moms and dads," and the next day, tech giant Microsoft announced its own new "enhanced parental leave" policy: 12 weeks of "paid at 100 percent" leave for all new mothers and fathers – which is in addition to the eight weeks of paid maternity disability allowed to birth mothers, also "paid at 100 percent."

A few days later, Adobe announced its own enhanced leave policies, citing those policies announced by Netflix and Microsoft. These employers are joining the same camp as other tech giants such as Google and Twitter, which had already offered employees their own respective enhanced leave policies.

The recent string of these announcements appear to be due to a employee benefits "arms race" (for lack of a better word), not because of a need to become compliant with any forthcoming federal regulations. Indeed, although President Obama has been pushing for broader employee leave policies, Congress appears steadfast in its refusal to follow his lead. As such, there are no imminent legislative changes prompting employers to offer such "enhanced" leave policies.

Nevertheless, many employers may feel increasingly compelled to adopt such policies in the face of an increasing number of their competitors doing so.

If your company decides to follow suit, what implications should be considered as general counsel?

First, although such policies are truly voluntary on the part of the employer and go above and beyond the minimum requirements of federal and state laws, those "minimum requirements" are still there and must be observed. While your state’s requirements may differ, all companies operating in the U.S. must comply with the requirements of the Family and Medical Leave Act (FMLA), which requires employers to provide eligible employees with 12 workweeks of unpaid leave in a 12-month period for "the birth of a child and to care for the newborn child within one year of birth" or "the placement with the employee of a child for adoption or foster care and to care for the newly placed child within one year of placement."

For employers to whom the FMLA applies, this means more than simply ensuring that employees are allowed to take the minimum 12 weeks of parental leave. Instead, employers – especially those employers with more expansive leave policies – must ensure that employees taking FMLA leave do no work during those 12 weeks. While this may seem like an obvious point, many companies with extended leave policies often work out arrangements with employees on longer leaves for them to work part-time, from home, or both. While these arrangements are perfectly acceptable and may even be necessary in some circumstances, they can only take effect after the 12 weeks of FMLA leave taken by the employee.

GCs should also be cautious to ensure any enhanced programs are implemented as uniformly as possible across the organization so as to prevent any potential claims of discrimination. As a part of this implementation, GCs should ensure that their company’s human resources department is well-versed in the policy such that they are able to clearly and effectively communicate the specifics to employees across the organization.

As mentioned earlier, there are no impending changes to employment regulations that necessitate these changes; they are voluntary changes that typically go above and beyond existing state and federal requirements.

However, just because an employer adopts enhanced leave policies doesn’t mean that these existing regulations cease to apply, and GCs should ensure that any new leave policies continue to comply with existing regulations.

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