Draft a parental leave policy with our interactive tool

You already know that creating a parental leave policy isn’t easy (that’s why you’re here). Regardless of company stage or size, if it’s your first policy or an update, it’s important to have something solid in place, as it communicates your company values and culture to current employees and prospects. When the need finally arises, it gives employees and People teams peace of mind by spelling out who’s responsible for what and offering clarity about their rights and benefits.

That’s why we created our parental leave policy template generator. We built it with guidance from our founding legal counsel, Frank Alvarez, who brings 30+ years of employment law experience. Start by filling in the details, and based on your inputs, the generator will give you a first draft of policy language that you can continue to finalize. You can use this blog side by side with our generator and benchmark survey data to better understand the components and considerations that go into a parental leave policy.

What to consider before launching your parental leave policy

1. Know your “why”

Like most endeavors, it helps to know why you’re doing something before you jump in. Get grounded in why this policy is important to your company and its employees, and why now is the time to enact it. Tapping into your company values and culture. and how you communicate them, helps you get a feel for how you can frame your policy statement. The policy statement is your company’s time to shine, highlighting its unique culture and generosity. 

2. Define employee eligibility

After setting the tone, you’ll need to determine who is eligible, as parental leave covers a lot of different circumstances, like adoption, foster care, or surrogacy. If you haven’t thought through these different scenarios, you might be unintentionally excluding certain families and setting yourself up for miscommunications, lost pay, or legal problems. Below we list some common examples of internal eligibility parameters, what groups parents might fall into, and what benefits they could access (you’ll see them in the policy generator, too).

Some common eligibility parameters

• Employee tenure/hours of service
• Full-time vs. part-time vs. short-term
• Exempt vs. non-exempt
• Geographic considerations (including worksite size)

Cocoon benchmark: 43% of Cocoon customers have a tenure requirement, and of those that do, the median is 6 months (compared to FMLA’s 12 months)

Pro tip: Don’t forget edge cases! For example, would your policy apply to newly hired employees who received children into their families within six months of their start date? The shorter the tenure requirements in your policy, the more likely this question is to come up.

Eligibility groups/scenarios

• Birthing and non-birthing parents — including both emphasizes the unique leave needs of each group (i.e., pregnancy-related and childbirth disability are unique to birthing parents) 
• Surrogacy
• Adoption
• Foster care

Pro tip: New parents via adoption and foster care aren’t limited to newborns and infants, so make sure your language reflects that. 

Benefit offerings

• Time — how long is their leave? Do they have rights to intermittent leave/reduced leave schedules?
• Pay & source — how much will they get paid while on leave? Where does this money come from (e.g., state, insurer, employer)? What happens to commissions and stock option vesting?
• Access to health/non-health benefits (e.g., continued vesting schedule and receiving health insurance)
• Protected time off — will you commit to restoring their same job, an equivalent position, or something else at the end of leave?

Cocoon benchmark: 98% of Cocoon customers offer birthing and non-birthing parents 100% paid leave. Many employers don’t pay everything out of pocket, recouping benefits from private disability and state programs.

3. Align your policy with legal requirements and related company policies and benefits 

Now that you’ve mapped out who’s eligible for what, you need to reconcile that with federal and state laws and your company’s benefits and policies. This is where things can get a little tricky, as things can vary by location—especially if your company operates in many states—and you might not be able to identify all applicable statutory leaves and benefits. However, your policy should recognize that overlapping legal obligations may exist and commit to interpreting and aligning the policy consistent with those laws and related company policies (e.g., PTO policies). 

Common statutory benefits and company policies to consider

• Federal FMLA
• State unpaid leave
• State disability benefits
• State paid family leave benefits
• Private insurance benefits
• Voluntary additional employer pay (e.g., top-up pay)
• Health insurance
• Other non-health insurance benefits (e.g., accrual of PTO, continuation of pension, access to childcare or educational assistance benefits, etc.)

Questions to ask

• Do you match or exceed these benefits and in which cases?
• Will you provide the same or more than what you are obligated by law?
• Will you provide a basic level regardless of employee location?
• Will your policy run concurrently with overlapping statutory benefits or be “stacked” on top of them?

Pro tip: Our interactive state leave laws map and FMLA checklist explain more about companies’ legal obligations for a deeper dive. 

4. Map out responsibilities for important stakeholders

Finally, clarify who’s responsible for what in order for an employee to access these benefits, and document these responsibilities in a place that’s easy to find and always up to date. Failure to do so may mean missing crucial paperwork deadlines that delay pay or make it hard for a leave-taker to understand where they are in the process.

Who are your stakeholders?

• Internal: People/HR, Benefits, Legal, senior leadership, person taking leave, leave taker’s manager and team
• External: Leave administrators, state benefit agencies, disability insurers, medical providers

What are leave-takers’ responsibilities? 

These are just a few examples of responsibilities. You also need to be extremely clear about where these things can be accessed and/or submitted.

• Completing forms — most parental leaves will require employees to file claims with their state, a private disability provider, or both
• Providing information and documentation — what information is needed and in what format? (e.g., a medical certification or doctors' note)
• Understanding consequences —what are key deadlines? What happens if an employee doesn’t comply? (typically delayed or unreceived pay)

What are others’ responsibilities?

‘Others’ here might refer to your People/HR team, or perhaps the external vendors on their behalf, or even an employee’s medical provider. Make sure you know who’s responsible for what and what your leave management partner actually covers.

• Approving or denying leave
• Documenting dates employees provide notice of the need for leave
• Evaluating employee eligibility and calculating leave availability
• Providing employees forms and required legal notices
• Completing required medical certifications
• Reviewing submitted documents
• Ensuring employees understand their rights and obligations, including time deadlines
• Reviewing fitness to return to work and crafting a return to work plan

5. Get a legal review

We just walked through a lot of information (and unlike Frank, you probably don’t have decades of experience in the nuances of employment law.) That’s why after using our parental leave policy generator, and working through the preceding list, you’ll still need legal advice and reviews with an expert who can marry the specifics of your particular organization’s policies with state and federal guidelines, in language that holds up to the law. 

So, while it’s impossible to give each unique organization a copy and paste template for their exact policy, we can help you do some of the heavy lifting to get started—ultimately helping you bring your policy to life faster for employees and their families who need it.