Maternity leave is a core component of virtually any benefits package for both small and large companies. However, it’s also one of the most misunderstood subjects for many professionals. Our article is going to help teach you about how maternity leave works and the primary differences between it and other subjects like FMLA and short term disability coverage.
How Does Maternity Leave Work?
Starting With the Basics
The first thing to understand when learning how does maternity leave work is that maternity leave is actually comprised of three different subjects that tend to get lumped into one.
The three subjects that we are going to discuss are:
- FMLA maternity leave policies;
- Short term disability maternity leave;
- Stand-alone maternity leave policies.
Each of these subjects will be broken down in greater detail further below. For now, the important thing to note is that all maternity leave policies are designed to protect an individual’s employment status during pregnancy and for a set amount of time after childbirth.
FMLA – The Biggest Maternity Leave Policy Factor
The most important component of learning how does maternity leave work is to get a basic understanding of FMLA. Short for the Family Medical and Leave Act, this policy was developed and implemented nationwide in 1993. This law is designed to provide up to 12 weeks of unpaid leave for qualifying life events.
It just so happens that one of the most common qualifying life events is the birth of a new child. Additional qualifying life events include placing a child in foster care, care for an immediate relative, or to treat a serious health condition for the employee themselves.
In addition to needing to meet specific qualifying life event guidelines, there are also a series of other requirements for the employee and the employer. For the employee, they must have worked with your company for at least 12 months and have clocked at least 1,250 hours. On the company side, you are required to adhere to FMLA guidelines whenever you employ 50 or more employees.
An important note to remember is that some state laws provide an even higher level of protection than what FMLA does. If this is the case for your area, you must adhere to whichever law provides the higher level of employee protection. In all other cases, companies are bound by the FMLA law to provide specific protections to their employees. You can view the official FMLA policy by visiting the United States Department of Labor website.
What About Short Term Disability Maternity Leave?
The thing that confuses most people about short term disability maternity leave is that it tends to go hand in hand with existing FMLA policies. Short term disability is typically an optional coverage that is offered to most qualifying employees during their initial orientation. In most cases, it is also offered during annual benefit plan renewals as well.
For many employees, they underestimate the type of coverage and protection that these plans tend to offer. As the name implies, short term disability is designed to cover a portion of an employee’s earnings for a small amount of time. In most cases, short term disability can run anywhere from six to eight weeks. It typically covers anywhere from 70 to 80 percent of an employee’s typical earnings.
Some companies may choose to pay for short term disability coverage for their employees. The cost is typically substantially less than that of more expensive policies like health insurance. Some smaller companies may choose to pay a portion of it instead to help make it more affordable for their employees as well. However, it’s important to note short term disability maternity leave coverage is not mandatory for employers.
Moving On to Company Maternity Leave Policies
Now that you’re able to answer how does maternity leave work, we’re going to cover company specific maternity leave policies. Company-specific maternity leave policies can be designed to work with or supplement existing FMLA guidelines and state recommendations.
For example, an employer may opt to pay 100 percent of a worker’s standard compensation for a specified period before and after the birth of a child. Another common example of a company-specific maternity leave policy is that is that employers may mandate that an employee exhaust all sources of paid time off before resorting to using FMLA leave.
These types of policies will vary based on the size of your organization, its operating budget, and the number of employees that you have to cover key operating positions. Just remember that any maternity leave policy developed by a company should be clearly disclosed in the company handbook for employees to review as needed.
Three Tips for Creating a Comprehensive Maternity Leave Policy
Get Your Basics Covered First
The first and most important thing to start with when creating a maternity leave policy for your company is the basics. This will include both FMLA and state-specific protections that pertain to your area. When in doubt, it’s a good idea to consult with a licensed attorney to ensure that you are aware of all the relevant employment laws for your area.
As we mentioned earlier, the number of employees that you have will be one of the largest factors that determine your need for FMLA compliance. If you have 50 or more employees, you must meet the minimum requirements outlined by FMLA. You should also ensure that you have accurate methods to track employees hours to help gauge whether they meet the specific hour requirements for FMLA as well.
Factor In Your Operating Budget
Your total operating budget is another huge factor that you should take into consideration when implementing a company-wide maternity leave policy. If your company has the funds to spare, opting for company paid coverage goes a long way toward improving employee relations by showing your workers that the company is invested in their future.
Even if your company cannot afford full company paid maternity leave, you may be able to opt for company paid short term disability insurance. This type of protection is often extremely affordable. Larger organizations are often able to leverage their buying power to garner more attractive rates to cover their employees.
Don’t Forget Staffing Needs
Ultimately, the staffing needs of your company will have a direct impact on the type of maternity leave policy that you can implement. For smaller companies, it’s often much more difficult to ensure adequate staffing coverage when key members of your team are out on maternity leave. With this in mind, a more strict maternity leave policy is often the best bet. On the other hand, companies with more employees can often afford to offer employees more flexibility with their maternity leave needs.
Drawing to a Close
Now that you have a basic understanding of how maternity leave works, you should be able to work on a comprehensive maternity leave plan that addresses the needs of your company and its employees. If you have any tips you would like to offer other HR professionals with maternity leave, feel free to post them in the comments area.