Why Budgeting For Paid Parental Leave Is Actually A No-Brainer

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By Samantha Samel

READ MORE: Maternity leave, Paid leave, Parental leave, Paternity leave, Benefit Cosmetics LLC, New moms, Working dads, Working moms

Companies hesitant to improve their parental leave policies often point to the financial burden associated with offering employees paid leave. Yet research has shown that providing paid parental leave actually makes good business sense; the benefits outweigh the costs, and budgeting for a parental leave program is one of the smartest and simplest investments a company can make.

Fairygodboss recently got the inside scoop from one employer who makes the case quite clearly. Mozilla’s new parental leave program has just gone into effect, offering 26 paid weeks of maternity leave to childbearing parents and 12 paid weeks to fathers, adoptive and foster parents, and partners of childbearing parents. Mozilla’s expanded policy applies to employees in the 15 different countries where the major nonprofit operates. 

Rachel Frazier, Mozilla’s Senior Global Benefits Manager, spoke to Fairygodboss about how this new policy came to be, how employees have responded, and why it’s been a great business decision for the company.

One of the most poignant points she made related to the budget that Mozilla developed for its new policy. “Mozilla provided an additional budget that would be enough to cover the leave, dedicated benefits, and hiring a temp for everyone who requested a leave,” Frazier explained. “Full pay and benefits was a basic feature of the program, but what was unique was this budget reserve for temps,” she said.

She drove home the point that companies are already budgeting for employees’ yearly salaries; when an employer makes a hire, they plan on paying that employee for the full year, not factoring in any deductions in salary based on the chance that the employee might take some unpaid leave. Frazier put it simply: “[Employers have] budgeted for [employees] to work all year.”

The additional cost, then, comes with providing extra support for employees who have team members going out on leave. Frazier says that Mozilla made a smart choice to create a financial reserve in anticipation of this extra cost so that employees and the company would remain productive, and so that parents who take leave don’t worry about coming back to six months of emails. Mozilla also made sure to provide additional manager training so that managers who had a team member out for six months were well-supported during this time.

How did Mozilla decide to offer 26 paid weeks to childbearing parents? They did their research, investigating what other Silicon Valley companies similar in size tend to offer. Frazier said the range seemed to be six weeks on the low end, and 52 weeks — which Netflix generously offers — on the opposite end of the spectrum. Mozilla decided to provide six months of paid leave, ranking just behind Netflix in terms of most paid weeks offered. It was important for the company to keep their policy aligned with their nonprofit vision of valuing people first.

“What makes us unique is that we’re going to do this in all of our countries; it’s not just for U.S.-based employees,” Frazier added.

Mozilla’s policy is also unique in that it has a lookback component that allows any parents who welcomed a child in 2016 to take advantage of the new policy. “No matter when you roll out a program or policy, someone’s always going to be on the wrong side. We decided that a lookback was the most fair and equitable thing to do [for those] who welcomed a child in 2016. I know our employees are definitely benefiting from that,” Frazier said.

Of course, with any new benefits policy also comes the additional work of getting the word out so that employees — both current and prospective — are aware of the new system. Mozilla, anticipating this challenge, developed a robust communication plan that Frazier says “started wide and went small.” The company first emailed everyone to give them a heads up, then directly emailed everyone who had taken leave in 2016 to alert them of the lookback eligibility, as well as those they knew who planned to take leave in 2017. They also scheduled one-on-one meetings and video conferences with employees, and Frazier set up office hours in time zone-friendly times for all of Mozilla employees.

In keeping with its people-first mentality, Mozilla is allowing parents to break up their leave into different segments. No parent is required to take 26 weeks in a row; Frazier explains that “some folks who are very career driven might think, ‘I’m not sure I want to be out six months in a row.’” They have the ability to come back to work before the 26 weeks is up, and then take additional time off later on. This helps parents and their partners stagger their leave so that they’re maximizing the time they’re spending with their child — in short, they can use the time off however it works best for them and their family.

“[At Mozilla, we figured] why not make this a family-friendly policy, because employees are more likely to come back and are less likely to worry about job security.” Frazier explained. “For new parents, especially, that is so challenging; there’s so much to think about, [and we want them to be able to] focus on what’s important, which is family.”

“I think that’s really the bottom line: happier people are happier employees.”

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