Time and again, one of the most common questions we hear from People leaders is “how competitive is our leave policy?” In today’s highly competitive talent market, it’s not surprising that tech companies are hyper aware of what their policies communicate to candidates and current employees as well as how they benchmark against their peers.
In an effort to get a leg up, we’re seeing companies expanding their existing policies to better support caregivers and working parents, plus introducing more progressive types of leave. To better understand just what these policies look like, we dove into the data of 108 venture-backed tech companies’ parental and medical leave policies in 2022.
Parental leave policy benchmarks
Paid parental leave is table stakes for employees working in tech. The vast majority of companies in our analysis offer 100% pay for the full duration of parental leave. Supplementing the benefits an employee may receive from their state or their company’s disability insurance is one of the best ways People leaders can make sure employees have as smooth a leave experience as possible.
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Across companies of all sizes in our data set, the average leave policy for birthing parents is 14.9 weeks and 10.8 weeks for non-birthing parents. Here’s a look into how that breaks down as companies grow:
Early stage (5-200 employees)
- Birthing parent policies ranging from 4 to 26 weeks with an average of 13.8 weeks of parental leave
- Non-birthing parent policies ranging from 2 to 18 weeks with an average of 9.8 weeks of parental leave
- As companies grow from very early stage with just a handful of employees towards the 200-employee mark, their policies tend to increase by 30-40%
Growth stage (201-1,000 employees)
- Birthing parents at growth stage companies are offered an average of 16 weeks of parental leave
- Non-birthing parents are offered an average of 11.8 weeks of parental leave
- Companies with 501-1,000 employees have notably more generous policies for birthing parents offering an average of 17.5 weeks
Late stage and public (1,000+ employees)
- Birthing parent policies range from 4 to 20 weeks with an average policy of 15.4 weeks
- Non-birthing parent policies span from 2 to 18 weeks with an average policy of 11.7 weeks
Medical leave policy benchmarks
Paid medical leave is less common in our data set. Of the 108 companies in our data set, 58 shared medical leave policies. All of these policies include top-up pay for employees while they’re receiving disability payments so they receive 100% of their normal pay while on medical leave.
- Across all companies the average medical leave policy is 3.4 weeks
- For early stage companies, the average is 4 weeks
- For growth stage, the average medical leave policy is 2.5 weeks
- For late stage and public companies, the average is 4.7 weeks
Creating competitive leave policies beyond time off
If you feel like your company is already offering competitive leave, it’s important to look at which levers you can pull beyond actual time off. One increasingly popular way to do this is by easing team members back into work with ramp back programs, supporting them with more flexible hours as they adjust to their new normal.
One of the best of such a program is Dropbox, where employees receive 100% pay for working at 60% capacity in their first week back. This helps employees transition back into their role after a long leave, and focus mostly on catching up and getting settled with new responsibilities like childcare and pumping time.
And, if such a generous policy sounds like a hard sell to your leadership team, the facts may surprise you. A significant portion of your 100% paid policy can be funded by state and insurance policies (and Cocoon can help you figure out exactly how your employees on leave get paid, and from where). Additionally, competitive leave policies help attract and keep talent, so the benefits are far-reaching where it comes to engagement and retention.
And if you’re hesitant that it may be too soon to implement such competitive leave policies, many of the best people leaders craft policies based on where they expect their company to be a year from now. Proactively planning for the future allows companies to attract and retain talent going into the next phase of scale.
Competitive paid leave is more or less table stakes for tech companies, so it’s important they find new and innovative ways to support employees taking leave.
It’s clear that people leaders are responding to the needs of their employees and recognizing the importance of employee benefits, especially where they impact major life events. By understanding how other companies are managing leave, people leaders can craft policies that are competitive, compassionate, and supportive.