Corporate Models and Working Families – Part 1
The following entries are taken from ‘The Nanny Time Bomb’ 2009.
“… we (USA) are one of only four countries, out of 168 countries, that doesn’t have some form of paid family leave for new moms. We join Papua New Guinea, Lesotho, and Swaziland as the four countries that don’t have paid family leave for new moms.” 1
Maternity/Paternity leave for parents is a key component in high-quality childcare. Not only does Maternity/Paternity leave allow parents to bond with a newborn, it leads to better health: allows for breast-feeding, vaginal recovery, infant immune system development. Interestingly it also provides greater economic stability for employers.
“Daily Women’s Health Policy Report today reported that: Two new studies from University of California-Berkeley researchers found that pre-birth maternity leave and longer post-birth maternity leave are associated with better health for both infants and women, the San Francisco Chronicle reports.
[lead author Sylvia Guendelman, professor of maternal and child health at the university] said, “What we’re trying to say is that taking maternity leave may make good health sense as well as good economic sense.” She added, “These new studies suggest that making it feasible for more working [women] to take maternity leave both before and after birth is a smart investment” (Tucker, San Francisco Chronicle, 1/8)
If you consider the time and cost to replace employees, it makes sound economic and continuity of quality work sense to retain an employee, even if she does need maternity leave and becomes a mother. According to calculations from iSquare, the cost of employee turnover, “will easily reach 150% of the employees annual compensation figure. The cost will be significantly higher (200% to 250% of annual compensation) for managerial and sales positions.”
To put this into perspective, let’s assume the average salary of employees in a given company is $50,000 per year. Taking the cost of turnover at 150% of salary, the cost of turnover is then $75,000 per employee who leaves the company. Retaining employees, then, is clearly good managerial and corporate practice. That said it makes sense, then, for companies to institute policies that create the best circumstance for a new parent to adjust to a change in life status, such as providing adequate leave with appropriate financial compensation. Without this, employees are more likely to not take enough time or decide to quit.” 2 (Author Bold)
In the next blog – how modern corporations are adapting to working families.
NB* – Footnotes available upon request.