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By: Kayla Bell on May 26th, 2021

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What Family Leave Benefits Can You Offer for Childbirth Vs. Adoption or Surrogacy?

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I was recently reminded of a time when I was serving as the HR leader in an HR outsourcing engagement and one of my client's employees came to me with a query about family leave options available. This employee was about to become a mom through surrogacy, and she was unsure about what kind of benefits she could claim. Questions like, can adoptive parents claim short-term disability leave, like other employees do after childbirth?

Employers often find themselves helping their people to navigate a knotty tangle of parental entitlements. As of this present moment, we don’t have a federal maternity leave law that guarantees paid time off for new parents. A law of this kind might emerge soon, although it remains to be seen whether such a law would cover adoption, surrogacy, and other circumstances.

So, what can you do for an employee who is about to become a parent? Let’s take a look at the main provisions in such cases.

Family Medical Leave Act (FMLA)

The Family Medical Leave Act is the primary federal regulation that applies to new parents. Childbirth and adoption are both treated as qualifying events under FMLA, so my surrogate client could potentially be covered. FMLA entitles parents to up to 12 weeks of unpaid leave, plus continued access to group health benefits.

All public-sector and government are employers are covered by FMLA, regardless of size. However, not all private-sector employers fall under FMLA rules. To count as a FMLA-covered entity, you must have employed at least 50 people for at least 20 workweeks of the current or previous year.

Even If your company is covered, your employees might not be. The rules state that employees must have been with you for at least 12 months, and that they must have worked a minimum of 1,250 hours in that time. That averages out at around 24 hours per week.

The employee must also be located within 75 miles of an office that’s home to 50 employees. Essentially, this means that the employees of small, regional offices don’t fall under FMLA rules. However, you should note that FMLA’s definition of “location” is the office to which the employee normally reports. If an employee works from home and their home is more than 75 miles away from the office, they still qualify.

Paid Family and Medical Leave (PFML)

The big drawback of FMLA is that it is unpaid, which means that some employees won’t be in a position to claim their full entitlement. President Biden has proposed a law that would federally mandate paid parental leave, but that could still be some years in the future.

In some states, however, this benefit already exists. Nine states, plus the District of Columbia, have implemented a version of a Paid Family and Medical Leave policy that offers part of the employee salary while they are absent. These laws cover all circumstances where a new child joins the employee’s family, which includes adoption and fostering.

The nine states with such laws are California, Colorado, Connecticut, Massachusetts, New Jersey, New York, Oregon, Rhode Island, and Washington. Each state has its own terms in its PFML law, with payments ranging between 50% and 100% of salary, and a maximum term of eight to twelve weeks. I recommend speaking with your HR consultant if you’re unsure about how these laws apply to your staff.

Short-Term Disability (STD)

Short-Term Disability is a form of insurance that offers wage replacement during time off for debilitating medical conditions. STD is mandatory in five states (California, Hawaii, New Jersey, New York, and Rhode Island.) Everywhere else, it’s a benefit that employers can choose to offer.

As an employer, you can define the terms of your STD offering, including:

  • Percentage of salary paid
  • List of qualifying medical conditions
  • Wait period before employees become eligible for STD

Many companies offer six to eight weeks of STD payments after childbirth, or up to twelve weeks if there were birth complications. STD is not, strictly speaking, a form of maternity leave. Instead, it’s a payment to help cover wages while an employee is recovering from a medical event – such as giving birth.

This means that STD payments are generally not available to adoptive parents. Neither can an employee claim STD when their partner gives birth. For an employee to receive STD payments, they themselves must be recuperating from a medical event.

Parental Leave

Parental leave policies are entirely at the employer’s discretion. You can choose to offer paid or unpaid leave, and you can offer as many weeks as you like. You can set varying terms for employees depending on position and tenure, and you can choose to cover adoptive parents and birth partners. Be aware, however, that you may run into some state or local laws that govern parental leave policies. Speak to a HR consultant if you’re unsure.

Parental leave is a very attractive employee benefit, especially for mid-career employees who might be thinking about expanding their families. Leave policies in general are an important part of the total rewards package, so they will play a big part in your efforts to attract and retain talent.

It’s a good idea to look around and see what kind of parental leave benefits are available from rival employers. As of 2019, around 45% of employers offered some form of paid parental leave other than STD. Talk to a consultant about your overall employer value proposition to make sure that you’re meeting employee expectations.

Sick Leave

Sick leave is typically one of your core HR leave policies. Employers have a great deal of control over these policies, so you can define things like:

  • Number of paid sick leave days per year
  • Whether Paid Time Off (PTO) allowances can be used to cover periods of illness
  • Unpaid time off policies for long-term absence
  • Continued access to benefits during periods of medical leave
  • Whether to hold a position open during an extended period of absence

State and local laws might impact your sick leave policy, so check with an HR consultant if you’re making any big changes.

Does sick leave apply to pregnancy or adoption? As an employer, you have some discretion over who qualifies for this kind of leave. Again, it’s important to be aware of any regional laws that affect how you structure these policies.

Otherwise, your sick leave policy is part of the overall total rewards package. A great sick leave offering will help to engage and retain the best talent on the market.

Other ways to support employees

When a new child joins a family, it’s a pivotal moment for parents. They need time and space to bond with their new child, regardless of whether that baby arrived through childbirth, adoption, or surrogacy.

As an employer, the best strategy is to look for ways to support your people through these crucial life events. If you’re flexible and understanding, your people will reward you with dedication and loyalty.