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Gender Equity|February 07, 2017

Why it Pays to Offer Employees Paid Leave

Gabrielle Fitzgerald, Founder and CEO of Panorama


As the founder of a mission-driven organization, I had a bunch of tough decisions to make before hiring my first employees. However, one decision was easy: Offer paid family and medical leave to all employees.

It was simple for two reasons.

  1. I know firsthand the relief and support I felt when I was able to take paid leave when I had my daughters, first when I was working for the federal government and then during my time at the Bill & Melinda Gates Foundation.
  2. My experience leading teams and recruiting talent throughout my career and, most recently, as a new CEO.

Both times I took paid leave, I was grateful for the precious time I had to bond with my daughters and to make sure I was physically and mentally ready to be a productive team member. Still, the leave policies had their limits. While working at the government, I used a combination of temporary disability and vacation time, and couldn’t use accumulated paid sick leave. For both daughters, I realize what a difference it would have made for our family if my husband could have stayed home as well.

As a team leader, I’ve learned it makes a difference in overall performance when people feel their employer will support them during a critical time in their lives. Those employees tend to want to come back after welcoming a new child or caring for a loved one. And that’s a good thing, because institutional knowledge is too valuable to let walk out the door. Also, just knowing that their employer cares about them beyond office walls helps all employees – not just those who take paid leave – to be more motivated and engaged in their work. These benefits are invaluable for driving company performance.

Turns out, more than 250 large companies that offer paid leave report experiencing similar benefits.

Why Paid Leave is Good Business

In a new study I co-authored, “Why Paid Leave is Good Business,” companies report significant gains from offering paid family leave and say these benefits outweigh the costs of implementation. Importantly, this is true for all sectors, including those that have hourly and salaried workers. Most exciting are companies like Hilton, Union Square Hospitality and IKEA that recognize that every employee – from housekeepers, line cooks and clerks to executives – deserve the benefit of paid family and medical leave. They know it’s good for business to have a workforce better prepared to come back to work and committed to the company for recognizing that value.

The study, launched today at the MAKERS Conference, also shows that employers are expanding their policies to be more inclusive, reflecting modern family needs and covering hourly as well as salaried employees. In these cases, just as I did with Panorama, companies are benefiting from reinforcing their values through their paid leave policies.

Despite the steady drumbeat of companies announcing new or expanded policies, the reality is that too few employers are following suit. Without a federal mandate, only 14 percent of the U.S. workforce has access to paid family and medical leave.

A national policy would go a long way to fix this, but in the meantime, it’s encouraging to see that companies are taking the lead for now. I look forward to continuing to make sure more employers know that paid family and medical leave pays off.

Read the full report here.

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