Employers are starting to realize that there are costs to a workplace that penalizes mothers and caregivers: lower productivity, lost talent, damage to business reputation, and even claims of discrimination.
Widely known as the “motherhood penalty,” the wage gap among women with children and those without has remained virtually unchanged over almost 30 years, with mothers of three or more children making 18 percent less than childless women, mothers of two making 13 percent less, and women with one child making 14 percent less, according to research from the Washington Center for Equitable Growth.
Women in the workplace often suffer great consequences for taking large amounts of leave, as opposed to their male counterparts, Sarah Fleisch Fink, general counsel and director of workplace policy for the National Partnership for Women & Families, told Bloomberg Law May 29. It’s not just promotions and advancements that can be affected; project assignments, lucrative clients, and “good” shifts often are sacrificed by women who take long leaves of absence from work for the birth, adoption, or fostering of a child, she said.
“The motherhood penalty is the tip of the spear to changes companies have to make to compete in the 21st century workplace,” Frank Alvarez, leader of the disability, leave, and health management practice group at management-side law firm Jackson Lewis, told Bloomberg Law May 29.
Leave and Wages
Though perhaps counterintuitive, providing comprehensive maternity leave in the workplace can be a friend, not foe, to reducing the motherhood penalty.
The National Bureau of Economic Research found that fully paid maternity leave benefits don’t increase maternity leave duration, and paid family leave benefits didn’t have any adverse consequences on “subsequent maternal labor market outcomes,” meaning how women fared in the labor market after returning from leave.
In fact, the research showed that a generous maternity leave benefit leads women to stay in the workforce compared with no leave benefit, and women were more likely to use the leave again for subsequent maternity needs.
California’s disability insurance program—which administers its paid leave program—authorized $4.6 billion in benefit payments from 2004 to 2014. Of the total claims filed, about 90 percent were parents bonding with a new child and 10 percent were individuals caring for a seriously ill family member, according to data from the California Employment Development Department.
“Our results assuage concerns that wage replacement during family leave may have unintended negative consequences for mothers’ future labor market outcomes through an increase in time away from work, at least among high-earning women,” researchers from the University of California Santa Barbara and Stanford University’s School of Medicine wrote. The findings are based on administrative data collected from the state of California, which has a paid leave mandate.
Additional Benefits Solutions
Companies also are using other benefits to help women balance family and work.
One strategy is to ensure that employer-provided paid parental leave is gender-neutral, Fink said. “If you have the expectation that parents will take the leave offered to them, regardless of gender, then it’s not just women that are away from work for a period of time after the birth of a child. This helps address equality in the workplace directly.”
Equal policies for parents in the workplace help employers avoid gender discrimination, Alvarez said, but challenges still lie in integrating different types of benefits like bonding benefits, disability leave for childbirth, and state and local law requirements.
Alvarez said companies also are considering including flexible return-to-work policies, back-up day care benefits, and elder care and end-of-life care benefits.
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