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Companies retreat on paid maternity leave

A hopeful trend reverses. The past decade has seen a dive in the number of employers offering full pay during post-childbirth leaves.

by Dory Devlin  |  5641 views  |  5 comments  |        Rate this now! 

From the I-guess-it's-no-surprise-but-still-tremendously-disappointing files, the Wall Street Journal's Sue Shellenbarger reports that companies are pulling back on paid maternity leave benefits. As companies try to rein in benefits and disability costs, it makes sense that full pay during maternity leave would be among the benefits to be whittled away, but it it is a darn shame.

To be clear, the federal Family and Medical Leave Act provides all employees with the right to take unpaid leave to care for a newborn baby or an ill family member. But about a decade ago, many companies were distinguishing themselves in their quest to hold onto talented employees by offering 100-percent paid leave post-childbirth, making it not only possible for women to take a leave to care for their newborns but also providing added incentive to return as soon as possible to an employer which had gone above and beyond. In 1998, 27 percent of companies offered full pay for childbirth leave, according to the Families and Work Institute. Now, 16 percent of employers do, based on a sample of 1,100 employers.

During those same years, the average maximum length of job-guaranteed leaves for moms dropped from 15.2 weeks from 16.1 weeks. Leaves for dads fell from 13.1 weeks to 12.6 weeks.

"This comes despite research showing attentive nurturing has particular developmental power in a baby's first year, and that longer leaves can ease postpartum depression in some mothers," Shellenbarger writes. "The pattern heightens the need for parents to plan carefully for time off post-childbirth."

Absolutely.

Shellenbarger found in a poll she conducted for her column that about one in five couples rely on credit cards and loans to fund time off from work to care for their babies. A tough way to start out as a family.

Since only one-third of employers offer some kind of paid leave to employees, according to the Society of Human Resources Management, and not all of them offered 100-percent pay at any point, this may not seem like a big deal because so many people were never offered these benefits. But it signals the reversal of a pretty important trend, one that supported parents and babies at a really crucial and relatively short point in their lives. Since major companies have the power to set a course for how other employers treat employees, the trend toward fully paid leaves was a good one. Faced with the need to tighten budgets, companies are reverting to treating maternity leave solely as short-term disability leave, which typically pays a fraction of a salary for the duration.

About the Author

Dory Devlin is the Work+Money editor on Yahoo! Shine. Check out Shine Work+Money here.

Read more by Dory Devlin

5 comments so far...

  • I'm Canadian, so I had a year paid maternity leave although paid equals a maximum of 1300 dollars a month, hardly enough to live on.

    Still, I feel so bad for my American friends that have to return to work so soon after their babies are born. I always find the discussion so fascinating.

    Flag as inappropriate Posted by Kristin Darguzas on 26th June 2008

  • I'm currently pregnant with my first baby...only about 2 months at this point but I went ahead and told my work because we don't actually have a maternity leave policy. We're a small company and I'm currently the only employee that could possibly need maternity leave (17 males, 1 other female that is past menopause, and me). Now granted some of the males could take leave if they were to have any more babies, but they'd probably need to make up that policy on the fly too.

    Anyways, since they are now going to start developing a maternity leave policy; let's hope it's a good one. I know the guy in charge of developing it has 4 kids so hopefully that will help him realize the need of the mom to be able to stay home for a while with the baby without worrying about not getting paid at all. And maybe, since I'm the guinea pig that gets to test out the policy they will allow some feedback if I think the policy is not acceptable.

    Flag as inappropriate Posted by Jenni on 25th June 2008

  • I took my full 12 weeks of leave, all of which was paid by the State of California. My husband also took 6 weeks of leave, paid by the State of California.

    But, 12 weeks? Not nearly enough. If I ever have another child, I will take at least 6 months, even if half of it is unpaid, and pray that my employer finds me valuable enough to give me my job back.

    Flag as inappropriate Posted by Mom2Rylie on 14th June 2008

  • I love living in America, but its sometimes hard to view it as the "best" or "the leader" when you read about the woeful way its workers are treated. So many other countries have PAID leave of up to a year for mothers. Further other countries have longer vacation times etc. I suppose the fact that Americans work so much is why its so productive, but I do know that many workers would take pay cuts to have a little free time or less work stress.

    BTW...when my second child was born, I worked for the state which allowed me to use donated leave from other state workers. The result is that I only had 2 weeks unpaid leave... so I can't complain too much.

    Flag as inappropriate Posted by Leslie Truex on 13th June 2008

  • I was lucky enough to be able to do what you did for my maternity leaves -- cobble together sick time and vacation time in order to get a significant chunk of time to learn how to take care of my new baby, Thank you for writing this great article!

    Flag as inappropriate Posted by Lylah M. Alphonse on 13th June 2008

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