Human Capital & Careers

Make Room for Daddy

Researchers claim that in one state, paid paternity leave could save employers $89 million in employee-retention costs.
John GoffMay 7, 2004

Now here’s a different kind of bond issue. In a controversial vote in 2002, the California legislature passed SB 1661, better known as the Paid Family Leave Act. Under the legislation, both male and female employees in California can take up to six weeks of paid leave to spend time with newborn or newly adopted children or foster children. The law, which kicks in July 1, is funded by employee contributions.

Business groups, which lobbied against SB 1661, say it’s a productivity killer. But researchers claim paid paternity leave could save the state’s employers $89 million in employee-retention costs. And family advocates say the bill is simply an acknowledgement of the realities of child-rearing in the 21st century. “The involvement of the father is crucial to the well-being of children,” asserts Roland C. Warren, president of the National Fatherhood Initiative.

Apparently some employers agree. A recent survey found that about 14 percent of U.S. companies grant paid paternity leave — well up from a decade ago. Most programs offer two weeks paid leave, and some offer four or more. Microsoft, IBM, Merrill Lynch, Eli Lilly, and Ikea all offer the benefit. Big Four accounting firm KPMG LLP launched a paternity-leave program in 2002, as part of the firm’s ongoing work/life initiative. Joe Maiorano, KPMG executive director of human resources, says the take-up rate has been near 80 percent.

Scott Fritz, director of financial reporting at KPMG, says he never hesitated to stay at home when his daughter, Sydney, was born last year. Says Fritz: “There’s a culture of understanding here that there’s more to life than work.”

Still, champions of work/life balance programs concede that male workers face obstacles in taking paternity leave — even if their employers offer such policies. “In most cases, it’s unrealistic to think there won’t be some consequences,” admits Warren. “There are trade-offs.”

Take SB 1661. Under the law, workers can take paid paternity leave, but employers with fewer than 50 employees are not required to hold their jobs for them while they’re away. That could qualify as a pretty bad trade-off.