Competition for talent is heating up in fast-growing sectors such as technology and finance – and some companies are touting their generous family leave policies to attract young, educated workers who value work-life balance.
Case in point: Netflix, which said last month it would offer new parents up to a year of paid leave, among the most generous benefits of its kind. Some speculate it could prompt other tech companies to adopt similar policies to attract top talent.
While experts don’t expect many companies to adopt policies as wide-ranging as that of Los Gatos, Calif.-based Netflix, firms in the technology and financial services sectors tend to lead the way. That seems to be the case with some technology and financial services companies with a presence in Charlotte:
▪ AvidXchange, a fast-growing tech company, offers four weeks of paid maternal leave and two weeks of paid paternal leave. The firm, which automates bill payments and invoices, has had that policy in place since its founding in 2000, but it’s part of the workplace culture the company boasts as it adds workers, said Todd Cunningham, senior vice president of human capital and talent management.
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The Charlotte-based firm, which currently employs 420, is on track to add 600 new jobs, including software developers and engineers, in the coming years as it readies to expand into new N.C. Music Factory facilities.
▪ Microsoft, which employs about 1,100 in its offices off Arrowood Road, last month said it was lengthening its parental leave policy to 12 weeks, fully paid, effective Nov. 1. That’s on top of the eight weeks of maternity disability leave the company offers. Previously, the Redmond, Wash.-based tech giant provided eight weeks of paid leave for new mothers, plus another four unpaid.
▪ Professional services firm Accenture, which has a Charlotte office, said last month it would allow mothers and primary caregivers to work locally instead of travel right after they return from parental leave.
Bruce Elliott, manager of compensation and benefits at the Society for Human Resource Management, cites a benefits survey this year in which 21 percent of U.S. companies said they offered a paid maternity leave benefit, and 17 percent offered a paid paternity leave. Five or 10 years ago, Elliott said, those numbers almost didn’t register.
“At a high level, it really varies significantly by the size of employer and by the industry,” said Steve Graybill, a Charlotte-based consultant at HR advisory firm Mercer.
Experts say attracting millennials, who are starting to have children of their own, is behind the shift toward more progressive parental leave policies.
Charlotte has seen a flood of young professionals moving in, evidenced in its ongoing apartment boom. About a quarter of Charlotte’s 757,000 residents are 20 to 34 years old, according to U.S. Census Bureau estimates from 2013, the most recent year available.
“When millennials view a job offer, they look online at much more detail than a baby boomer thinks of looking at,” meaning they scrutinize for benefits like leave policies and vacation, said Graybill, a baby boomer and father of two millennials. “They are looking for a work-life balance.”
That’s definitely the case at AvidXchange, where the average age of workers is 35, Cunningham said.
“There is no question we leverage that (leave policy) in attracting top talent,” he said. “We hired over 200 last year, we’re on pace to hire another 200 this year, and we’ll hire more than 200 next year.”
The landscape is competitive for banks looking for young tech workers, who are often lured to Silicon Valley by the likes of Google and Facebook.
Wells Fargo doesn’t separate its parental leave from regular paid time off, spokesman Josh Dunn told the Observer. Depending on their time at Wells, PTO ranges from 16 to 33 days off a year. The bank does offer six weeks of short-term disability for new mothers, Dunn added, and eight for women who get cesarean sections.
Charlotte-based Bank of America offers 12 weeks of paid leave for new mothers and fathers, as well as for new adoptive parents. The bank lets new parents take an additional 14 weeks off unpaid.
Andy Aldridge, a bank spokesman, said about 13,000 of the lender’s employees in the U.S. took some kind of parental leave in 2014. Ninety percent of women returned to Bank of America, and 99 percent of men came back.
The case is similar at AvidXchange, Cunningham said, where about 3 percent of the company’s workforce takes parental leave every year. Nearly everyone returns, he added.
Experts say retention is another big reason firms want to offer paid leave for new parents. Turnover is costly, and in reality only a small proportion of a company’s workforce takes maternity leave in a given year, notes Elliott of the SHRM.
And the amount an employer pays a worker in parental leave is about the same or less than what it would cost to rehire and train a new employee.
Further, Elliott said, “you have a known quantity coming back, as opposed to an unknown quantity that performed well during the interview but you don’t really know how well they’ll perform as an employee.”
Besides tech and financial services companies, experts say companies are more likely to adopt family friendly policies if they’re bigger and publicly traded. Charlotte-based Duke Energy, for instance, offers employees one week for dependent care, which could be for a child, parent or other family member. The utility company also offers employees $5,000 in adoption assistance.
The U.S. is the only industrialized country in the world that doesn’t mandate that employers offer paid leave for new parents, though certain states like California have their own plans in place. And according to the U.S. Labor Department, only 12 percent of private sector workers have access to paid family leave through their employer.
“It’s really going to be in the hands of the private (sector) employer as to whether an individual is going to be paid for a leave or not,” Graybill said.
Instead, the U.S. has the Family and Medical Leave Act, which offers eligible employees 12 work weeks of leave unpaid. Elliott said because they often have production quotas, manufacturers typically don’t offer paid leave.
“How many employees can afford to take three months off of unpaid leave? It kind of leaves the blue-collar or entry-level to mid-level professional out in the cold,” Elliott said.
Staff writer Gavin Off contributed.