AmEx Unveils a Big Weapon in the Parental Leave Arms Race
In a move to boost recruitment and retention while keeping up with the corporate Joneses, American Express Co. said it will offer 20 weeks of paid leave to any U.S. employee of either gender who has a child through any means, including adoption and surrogacy. Birth mothers will get an additional six to eight weeks of paid medical leave on top of that.
The announcement is a huge leap forward by the credit card company, since it currently makes separate provisions for primary and secondary caregivers of six and two weeks paid leave, respectively.
As companies like AmEx compete for talent in a tightening labor market, generous parental leave that doesn’t distinguish between moms, dads, or birth parents is slowly replacing maternity and paternity leave policies in the most competitive industries. Tech firms, in part because of their difficulty with recruiting and retaining women, have led the way. Etsy Inc., for example, now offers 26 paid weeks off for all new parents; Netflix Inc. offers up to a year.
But other industries have been quick to follow. Bank of America Corp. and Fidelity both expanded leave policies last spring.
“We are taking a close look at the market and where the market is moving overall. We think 20 is a generous step,” said Kevin Cox, the chief human resources officer at AmEx. “Our employees are generally saying we want more help and more support. These are busy people with busy lives.”
Indeed, 20 weeks of paid leave to any parent is aggressive. Even financial behemoths like Morgan Stanley, Barclays Plc, and Goldman Sachs Group Inc. offer only 16 weeks to primary caregivers, and much less to secondary caregivers.
But the larger reality is that most U.S. workers don’t get paid family leave at all. Yet, access is steadily increasing. Last year, New York and San Francisco passed paid family leave laws, and, President elect Donald Trump said during his campaign that he would push for six weeks of paid family leave for new mothers.
Meanwhile, to stay competitive, companies have engaged in a parental leave arms race. According to the Society of Human Resource Management, 21 percent of large U.S. corporations offered paid maternity leave in 2015, up from 12 percent in 2014.
Still, the benefit is unevenly distributed to high skilled workers and people who live in cities and states that have laws mandating leave. Many sectors and organizations still offer no paid leave. “The manufacturing sector tends to be more midsize smaller and midsize companies, and they’re not at that point where they are moving that aggressively toward parental leave,” said Lisa Horn, who heads up SHRM’s Workplace Flexibility Initiative. “There is a slow uptick in the number, which we take as a positive sign, but there is more work to be done there.”