Offering competitive paid leave benefits is becoming a business imperative. But the absence of any “standard” paid leave package, coupled with a lack of benefits transparency, has made it challenging for companies to achieve this goal.
To overcome these barriers, the National Partnership for Women & Families has launched a new initiative called the “Leading on Leave Index.” By providing tailored, cost-free resources, the Index will enable companies to more effectively benchmark their paid leave policies, adopt best practices, respond to employee priorities, and design competitive paid leave plans.
The Paid Leave Challenge
The demand for paid leave has increased among each generation of U.S. employees. Gen Z workers are the first to rate paid leave as their highest priority among employee benefits, with 69% describing paid leave as a “must have” in a 2024 MetLife survey. When asked to identify critical factors in choosing a job, 71% of Gen Z workers cited paid time off, according to a 2024 Economist Impact report.
As a result of employees’ shifting priorities, 84% of U.S. companies across sizes and industries reported plans to revise their paid leave offerings in the near future, according to WTW’s 2023 Leave, Disability and Time-off Trends Survey. Nearly three quarters of those employers cited recruiting and retention as their main impetus for change.
Plans to improve corporate policies are also being fueled by evidence that paid leave lowers business costs by reducing turnover, increasing employee productivity, morale, and engagement, and improving employee health and well-being. Business leaders are increasingly viewing paid leave not as a cost driver, but as a strategic investment.
Yet companies seeking to design competitive paid leave plans face several challenges. First, benchmarking is difficult because company policies vary widely on multiple dimensions. Companies offer many different types of paid leave, including parental leave, family care leave, medical and disability leave, and bereavement leave, among others. Each type of leave can also vary on length, amount of pay, eligibility, and other features.
Second, gathering data is difficult because of a lack of public transparency. Few companies disclose details on their full range of paid leave policies. This reluctance makes sense in the face of uncertainty about how a company’s policy might stack up against industry comparators.
New Resource To Support Corporate Progress On Paid Leave
The National Partnership for Women & Families (NPWF) is a nonprofit, nonpartisan organization with over 50 years of experience on paid leave. Located in Washington, D.C., the NPWF has been a leader on paid leave policy research, analysis, education, and legislative advocacy at the federal, state, and local levels. The NPWF was a primary author of the Family and Medical Leave Act, the only federal law granting eligible employees job-protected family leave.
In response to growing interest among the business community, the NPWF is leveraging its paid leave expertise to provide a valuable new resource for companies seeking to improve their paid leave benefit plans.
Private sector companies of any size that offer any amount of paid leave may submit a free application to participate in the Leading on Leave Index. In the application, a company will be asked to share details about its existing paid leave programs.
Unlike typical public ranking systems, the Leading on Leave Index will keep all individual company data private, unless a company consents to public disclosure of information.
The confidentiality component of the Index was the result of extensive NPWF consultation with business leaders to design the most effective support for improving paid leave. This unique aspect of the Leading on Leave Index empowers companies to provide complete data without concerns about poor ratings or public reprisal. The goal is to enable companies to receive valuable feedback, while allowing NPWF to analyze more complete data on industry trends.
“Paid leave is one of the most cost-effective and impactful investments that a company can make,” said Jesse Matton, NPWF Director of Corporate Social Impact Policies, in a phone conversation. “So we designed an easy runway for companies to participate, and we worked with company leaders to respond to companies’ confidentiality and privacy concerns.”
What Companies Receive From The Leading On Leave Index
NPWF experts will provide all participating companies with a paid leave action plan, the latest data on industry trends, and guidance on best practices. This information will enable companies to benchmark their policies against their peers and design more competitive paid leave plans.
All participating companies will be scored on the level of disclosure and commitment demonstrated in their existing paid leave polices. Companies with paid leave plans that obtain a best practices score will be invited to opt-in to public recognition in NPWF publications. Companies that achieve Index status will also receive a digital badge to use on their website or other company materials to highlight their commitment to paid leave.
Unlike other corporate rating systems, there is no potential downside to companies whose current paid leave plans do not meet best practices standards. NPWF will not disclose the names or scores of companies that participate and do not achieve Index status. Those companies will receive valuable information about improving their paid leave plans without any business risk.
This approach will also enable NPWF to provide much richer data to all companies on paid leave practices and trends. Prior NPWF indices had relied solely on publicly available data on paid leave, similar to other databases and public ranking systems. Relying on the limited nature of publicly disclosed data greatly restricts the ability for companies to benchmark across a wide array of metrics.
By gathering data directly from company participants, the new Leading on Leave Index will provide a much richer source of data on many dimensions of paid leave. NPWF will not disclose individual company data without prior consent. But all company participants will benefit from a report of aggregated data providing unique insights on industry practices and trends.
The Leading on Leave Index approach also enables NPWF to provide participating companies with a more holistic review of paid leave policies. This may include, for example, an assessment of primary and secondary parental leave parity, leave eligibility for part-time and hourly workers, and other important but often overlooked characteristics of paid leave plans.
Empowering full disclosure in a confidential application process will also enable the NPWF to identify cutting-edge paid leave developments, such as NICU leave, fertility treatment leave, abortion access leave, and others. Companies that opt-in to recognition can be highlighted as leaders on paid leave innovation, which can further advance their recruiting and retention goals.
To participate in the Leading on Leave Index, companies should submit an application by October 25, 2024. Questions should be directed to [email protected].