The majority of U.S. companies don't offer paid leave, so many new parents either don’t take leave or don’t report it to avoid taking time without a paycheck. Without a paid parental leave program, unfortunately, you can’t trust your historical parental leave data. To help you understand how and why this happens to improve your data collection accuracy, we’ll share four reasons why employees are underreporting parental leave and what companies can do to improve their data collection.
Parental leave goes largely unreported, especially by non-birthing parents, which leads to an inaccurate understanding of parental leave demand for many employers. If there’s no way to track it, how can you have historical data? Here are 4 reasons why employees are not reporting their leave (or not taking it):
The first and most common reason why is that there is no paid leave available. 63% of American workers say that parental leave benefits are important to them, but only 27% of employees have access to paid parental leave. Employees in states without Paid Family Leave (or company-provided paid leave) often opt to not notify HR of an upcoming new birth, adoption or foster. This is especially true if they are the non-birthing parent (e.g. father). Without PFL reimbursement or program benefits, employees see notifying HR as an unnecessary compliance step with no reward.
Note: While not reporting leaves may not seem like a big deal, it’s important to track the time away accurately (e.g. leave entitlements like FMLA). Pay or no pay, it’s a compliance risk. Check out our PFL Guide to see which states are eligible.
Companies with generous and unlimited PTO often see significant parental leave underreporting as employees use their PTO in 2-week increments for parental leave. We also see many fully remote employees skip taking a formal parental leave (translation: not reporting their time off) since they have work-life flexibility. This is especially common when there’s complicated PFL filing processes and these requests stop at their manager’s desk, but unlimited PTO is not the answer.
Unfortunately, this is still a real common occurrence. 65% of LGBQT+ parents worry that taking parental leave would negatively affect their job or career. Parental leave continues to be heavily stigmatized especially for marginalized groups who fear workplace repercussions, including delays in promotions, coworker animosity, and their commitment to work being questioned. 70% of LGBTQ+ employees are or want to be parents, but they’re disproportionately excluded from most leave policies and are not able to take time off with their new children.
According to Bloomberg, poor leave policies and current career demands are driving down the birth rate because employees can’t see a way to balance both. 30% of women quit the year they have a child, so employees without access to paid parental leave are more likely to stay childless or delay starting a family to save and plan for the parental leave. 60% of mothers want to spend at least 12 weeks with their child after birth, driving the need for robust savings even before pregnancy. With access to parental leave, families go from planning to having children.
A generous paid parental leave policy is the missing piece of the puzzle. A new paid parental leave policy will encourage family planning and prompt program usage. Paid parental leave makes parenthood attainable and possible for many. WTW’s Leave, Disability, and Time-Off Trends Survey found that 73% of employers have or plan to make changes to their leave programs to better support their attraction and retention strategies. Once a policy is in place, companies can expect to see employees begin family planning, followed by a boost in program usage and return on investment. This then helps companies attract and retain parent employees, restarting the cycle and productivity. Companies see a 69% reduction in turnover when they offer 12 weeks of paid parental leave, so those not investing in attracting and retaining this top talent will miss out on opportunities to stay ahead of the competition.
Ready to learn more? Chat with sales to see how Parento can help you offer paid parental leave.
