Tech’s opportunity to create a better paid parental leave system

Kristina Johnson is Okta's Chief People Officer.

Parental leave positively impacts both public health and the economy, not to mention individual well-being — as such, it should even be considered critical infrastructure. But without adequate parental leave available to most parents, the U.S. is falling short, and families and businesses suffer as a result.

Change to address the gap is underway but trudging. Today, corporate leaders have an opportunity to set forth a new base standard for employee benefits: one that focuses on the modern family and allows parents time to heal and bond, rather than making them choose between careers and their family. Times have changed: Mothers aren’t always primary caregivers, and there are more women in the workforce than ever. Today’s benefits packages must reflect this.

The importance of paid parental leave

Mountains of evidence point to why paid parental leave is beneficial in the short and long term for children, for parents and for the population. Studies on paid parental leave across the globe have pointed to benefits like decreased incidences of low birth weight and pre-term births, reduced rates of hospitalizations among infants and improved maternal and child health.

Paid leave also helps women stay in the workforce while still having the opportunity to spend time dedicated to healing and bonding with their child. As one mother at Okta said: “Okta's paid leave policy allowed me to enjoy the birth of my second child in a way that I was unable to do so with my first ... Not needing to worry about where my income would come from so that I could take the full time allotted to bond with my child and allow myself to heal is something I am so grateful for.”

Why paternity leave is part of family-centric benefits policies

Equitable parental leave policies must be gender-neutral and offer a length of time that enables parents to both heal from the birth and bond with their child. From showing the positive impact parental leave has on the baby’s physical health and development to highlighting the benefits paternity leave offers mothers, many studies have proven the positive impact that lengthy, paid parental leave affords families.

But these positive impacts are only possible if companies also create a culture that encourages parents to take advantage of leave policies. 76% of fathers are back at work immediately following the birth of their children, but peer influence and a culture that welcomes this much-needed leave can move the needle. One father at Okta said: “While [my previous company’s] paid leave policy looked good on the surface, there was extreme internal pressure that made it near impossible to actually be able to take it.” But culture can change this, to the benefit of all families. One study found that if a man saw his co-workers take paternity leave, it increased his chance of taking it by 11%.

For example, Okta experiences an equitable split of utilization for our parental leave policy between all types of parents. Prior to implementing our 18-week paid leave for all caregivers, we saw nearly 50% more utilization of the benefit from birthing parents. Since the expansion of our benefit, parental leave utilization has increased across the board with an equitable split between all types of parents. This is an indication of a truly equitable policy yielding favorable results.

Holistic family benefits policies may also go beyond paid parental leave, encompassing support for all types of families, including adoption assistance and leave, and fertility support through providers like Carrot or Modern Health. It’s especially important to equalize support for anyone starting a family, regardless of their parenthood journey.

Why businesses can and should invest

The cost to offer paid family leave is far less than the cost to backfill, recruit, interview and hire new talent. Inadequate leave policies simply breed attrition for parents, not to mention the loss of productivity for the company as the team scrambles to find replacements. With companies struggling to hire, it’s more important than ever to retain talent — and paid parental leave helps companies do just that.

For example, Susan Wojcicki wrote about the benefits that more leave time had on retention at Google: When the company increased its paid maternity leave policy from 12 to 18 weeks, it saw the rate at which new mothers quit fall by 50%. This can have massive implications for closing the gender gap in the tech industry writ large.

While paid parental leave policies are important for everyone, these setups importantly offer space for women to continue to advance their careers as mothers. As leaders grapple with "The Great Resignation,” comprehensive parental leave policies are just one example of how businesses can rethink their culture and policies to foster professional growth for everyone. Instead of focusing benefits packages on showy add-ons, companies can simply afford workers the time, space and financial support to be their best selves outside of work.

Becoming a parent or caregiver — whether for the first or third time — is a milestone that should be celebrated and supported. All parents, regardless of their gender or caregiving status, should be given the time to heal, adapt and bond with their child without the stress of having to rush back to work or face financial instability.