How to Create a Parental Leave Policy for Your Business

Many employees with new children need time to adjust and transition to a new lifestyle with their families. With the support of their employers, working parents can receive the right amount of time to bond with and care for their children before returning to work. Building an effective parental leave policy can build trust between employers and employees, resulting in higher employee retention, engagement and productivity.


Below, learn more about what a paid parental leave policy is, how to write one and the best parental leave policy practices to follow.

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What is a parental leave policy?

A parental leave policy is a benefit employers offer new parents that allows them paid or unpaid time off to care for their children. Parental leave policies give parents time to bond with their newborn and helps them adjust to their new lifestyle, lack of sleep and hectic schedules. Employers often offer parental leave to both mothers and fathers, though policies may sometimes be split up into separate maternity leave and paternity leave policies. The amount of paid leave generally lasts anywhere from two weeks to four months or more, depending on the company and state laws.


The only nation-wide policy that addresses parental leave is the Family and Medical Leave Act of 1993 (FMLA), which guarantees eligible employees (such as new parents) up to 12 weeks of unpaid, protected leave. FMLA applies to businesses with more than 50 employees and employees who have worked at a company for at least 12 months.


Paid parental leave policies usually cover mothers who recently gave birth and their partners, but they may include adoption leave for parents who have recently adopted a child and need time for their new family to adapt. These policies vary from company to company depending on what the company allows.

Additionally, “primary caregivers” (i.e., the person who has primary responsibility for the care of a child following birth) often receives more time off than “secondary caregivers.” Depending on the circumstances, the mom or the dad may be considered the “primary caregiver” and be eligible for more extensive leave.

Other parental leave policies may provide additional leave for parents who need to care for older children. For example, if a child is sick or has a doctor’s appointment, company policy may allow them to use their parental leave to care for the child.


See 15 more policies your business should consider.


Parental leave policy best practices

Follow the best practices below to help you determine the best parental leave policy for your company:


Research how other companies worldwide handle parental leave 

If your company operates in different countries or hires international employees, stay aware of the parental leave companies in those countries. Try to offer a parental leave policy similar to the ones in the country where your employees are located.


Consider the needs of both parents 

When you’re creating your parental leave policy, consider both parents and try to provide them with similar benefits. Since both moms and dads typically participate in the care of their children (and all of the late nights and early mornings that comes with it), consider offering parental leave to both parents.


Clearly explain parental leave policies to employees and be ready for questions

After writing or updating your parental leave policy, hold a meeting with your employees to discuss the rules of this policy. Detail each section and be ready for any questions employees may have. Be patient when answering questions and listening to employee concerns.

After writing or updating your parental leave policy, hold a meeting with your employees to discuss the rules of this policy. Detail each section and be ready for any questions employees may have. Be patient when answering questions and listening to employee concerns.


How to create effective parental leave policies

Follow the steps below to learn how to create an effective parental leave policy:

1. Ask employees what they need from parental leave

Gather ideas and opinions from your employees regarding what they need from parental leave. Create anonymous surveys for them to input their opinions or meet with them individually to gain an idea of what would benefit them the most. This can help you determine which benefits are crucial to include and which benefits your employees may not want or need.


2. Evaluate your budget

Before writing your parental leave policy, review your budget to learn what policies your company can afford and support. List your company’s goals and needs for the parental leave policies and try to build a plan around this. Review other parental leave plans used by different companies and find some to base your policy around. Tweak these policies to best fit your budget, goals and employee needs.


3. Review your state’s rules

When creating a parental leave policy, learn your state’s laws and regulations to ensure you’re in compliance. You can start your policy by listing the benefits required by your state and build the benefits and remaining sections of your policy from there. This gives you a place to start writing your policy and ensures you’re meeting all of the legal requirements.

For example, California requires employers to offer paid family leave (PFL) to employees who request it and are eligible. This includes paying 60% to 70% of an employee’s wages for up to eight weeks within a 12-month time period. This type of paid leave does not offer job protection like the FMLA does.


4. Present the success of other parental leave policies to stakeholders

Stakeholders may feel hesitant to invest in certain parental policies, especially if it’s a larger investment. Research other successful policies and find analytics or data proving the benefit and ROI it provided employees and the company altogether. For example, you could explain how a company provided parental leave, which led employees to stay at the company long-term, reducing the employee turnover rate by 20%.


Showing how a paid parental leave policy may help save money and the benefits it brings employees may be an effective way to convince stakeholders to invest in your policy.


5. Write your policy and have it reviewed

Once you’ve gathered employee survey information, budget details and competitive research, build your company’s parental leave policy by including any employee needs while staying within your budget. After you’ve drafted it, show it to different supervisors or leadership team members to get their thoughts and opinions. Getting feedback can help you better understand if your policy will be successful and beneficial to your employees.

If anyone has notes or updates, apply these changes before officially distributing your policy to employees.

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Parental leave policy FAQs

How much notice should an employee give before taking parental leave?

When coming up with the rules and regulations of your parental leave policy, include a section about employees providing you notice before requesting parental leave. This allows your employees to alert you of their upcoming extended absence to give you enough time to adjust and come up with a transition plan. Typically, the appropriate amount of time employers should give notice is approximately ten weeks before their parental leave begins, but this varies from company to company.

Is paid parental leave a requirement?

While there are no federal laws that require employers to offer paid parental leave, some states require a certain amount of paid leave to be granted for new parents. Everywhere else, the FMLA’s 12 weeks of unpaid parental leave is required for eligible employees.

Even if you’re not required to offer paid parental leave in your state, it can still be a smart move to offer it. Having a paid parental leave policy can lead to improved maternal health, better mental health for both mothers and fathers, reduced health insurance costs and happier, more productive and more engaged employees.

Does parental leave have to be continuous?

Under FMLA rules, 12 weeks of unpaid parental leave must end within 12 months after birth or adoption, but can be taken intermittently within this 12-month period if an employer approves of it. If you offer paid parental leave, you can choose whether or not it has to be taken all at once or if it can be taken consecutively, and note it in your parental leave policy. Check with your state’s laws on paid parental leave before making your decision. 

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