Business Issues

Workforce Benefits

The Family and Medical Leave Act requires that employers with 50 or more employees provide eligible employees with 12 weeks of unpaid job protected leave for family and medical reasons in a 12-month period.

There has been significant publicity lately about large companies going further and providing women, and in some cases, men, generous paid parental leave benefits. The issue gained even more visibility when Facebook co-founder and CEO Mark Zuckerberg announced that he was taking a two-month paternity leave upon the birth of his first child.

Paid Leave

Paid parental leave is a benefit to consider if your company is engaged in a talent war for new workers or is seeking ways to keep good workers. It often appeals to young, well-educated, technologically savvy employees, who are interested in maintaining a work-life balance.

In a Society for Human Resource Management newswire, Harvard Business Review identified three models for offering paid parental leave. The first model is “take what you need,” which allows employees to take as much time off as they like in the year after the birth or adoption of a child with full salaries paid and benefits maintained. This approach is used by Netflix for their salaried employees.

The second model involves lopsided leaves - one period of time for a primary caregiver and a shorter period for a secondary caregiver. Adobe has implemented this model with 26 weeks of paid leave for a birth mother and 16 weeks of paid leave for new fathers and adoptive parents. This approach is also used by Twitter and Google, although the two companies have different amounts of time for employees.

The third model is a standard policy for everyone. It usually involves approximately four months of paid leave to all parents within the first year of birth. Facebook uses this approach for both mothers and fathers.

In addition to those mentioned, many other large companies provide similar benefits in order to attract and retain valuable employees. However, only 21 percent of companies offered paid maternity leave and 17 percent paternity leave in 2015, according to the Society for Human Resource Management. That's up from 12 percent in 2014.

Other Options

Since paid parental leave benefits are expensive and of value to a specific segment of the workforce, businesses can still differentiate themselves by providing other benefits that may be of greater interest to their workforce. To start, review the demographic makeup of a company's workforce or survey employees to determine what benefits would have the broadest appeal.

For example, if the workforce is older, hands-on assistance from a qualified professional to help with financial and retirement planning would be of greater value than parental leave. A SEP-IRA account that has few administrative costs and operates like an individual IRA could be offered as a benefit, along with voluntary disability or long-term care insurance that employees could purchase.

Examples of non-specific benefits that are available to everyone and easily provided include access to a refrigerator stocked with healthy snacks and beverages, a stipend for a gym membership, gift cards or quarterly bonuses when projects are completed, telecommuting options, or an annual stipend for the purchase of new types of technology. These benefits tend to focus on present needs and desires rather than long-term goals.

Creative Benefits

Here are some specific examples of creative benefits, offered by companies.

Full Contact, a contact management company in Denver, provides employees with $7,500 for a vacation once a year. This is in addition to continuing to pay the employee salary during the vacation period.

Metis Communications in Boston has an enhanced vacation policy that provides three weeks' vacation, a day off for the employee's birthday, a bonus week of vacation after four years of employment, and summer Friday vacation days after five years.

The Red Frog Event Co. in Chicago provides unlimited vacation days, a work from home option one day a week, and a month paid sabbatical after five years as a full-time employee. A sabbatical is a unique benefit usually provided to long-term employees, as a way for employees to recharge their batteries by pursuing a hobby or travel.

Tasty Catering in Elk Grove Village, Ill., provides employees with funding to launch their own ventures. To date, 12 employees have obtained funding. The types of businesses launched have included a bakery, a gift company, and a creative agency.

Since each employee's personal needs and goals differ, Service Express in Grand Rapids, Mich., has attempted to customize a plan for each employee by having the employee meet with his/her manager twice a year to lay out personal, professional, and financial goals. In doing so, the employer can assist the employee in achieving those goals. This focus on each employee has resulted in a very low turnover rate.

The lesson for businesses competing for talent is to be adaptable and creative in providing employee benefits. Look to the demographic of the workforce, ask employees what is of greatest value to them, and tailor benefits accordingly.

This article is sponsored by the CCIM Foundation

 

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Mary Stark-Hood, JD, CFP

Mary Stark-Hood, JD, CFP, is president of the Hood Group, Inc., and serves as a consultant to the CCIM Foundation. Contact her at maryshood@comcast.net

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