Parental Leave for Hourly Workers

There has been a lot of press lately about paid leave and parental leave policies (or lack thereof) in the U.S. I expect the national paid leave debate to continue for quite some time. As there has been recent media attention around several companies (primarily in the technology sector) adding or enhancing their parental leave policies, it was interesting to see an article about Hilton Hotels now offering new parental leave benefits starting next year.

The new policy extends to hourly and salaried workers in any position who have been at the hotel for at least one year, including part-time employees. All new parents - including fathers and adoptive parents - will receive two weeks of fully paid parental leave. New mothers who give birth will receive an additional eight weeks of maternity leave, for a total of 10 weeks of fully paid leave.

Having worked in the hospitality industry, it is noteworthy to see this. It is noteworthy on several fronts. Historically, the hospitality industry, like retail and other high turnover industry sectors that provide large numbers of entry-level jobs, has not offered particularly generous traditional benefits to individuals employed in non-corporate, hourly positions. For example, the percentage of workers with access to all kinds of time off in the hospitality and food services industries is typically lower when compared to other industries. You may recall that Netflix received some negative press recently about their not extending their newly-announced unlimited parental leave benefits to employees in their DVD distribution centers.

It is, also, noteworthy because, since the market is not as competitive for certain entry-level jobs, attracting top talent is often not a critical factor; therefore, there exists less of a business case for extending parental leave benefits to entry-level workers. That's why it was great to read about Hilton's efforts and I wondered why the announcement didn't get a lot of fanfare, as compared to the recently-announced policies from other organizations. Hilton, like many companies in the hotel and restaurant industry, have many non-white-collar jobs. Of the 40,000 people the new policy will cover, 75% are hourly, which means many in lower-paid jobs, who often are unable to afford to take unpaid leave, will be able to have some paid time for the birth or adoption of a child.

Unfortunately, the new benefit won't apply to those employees who are covered by collective bargaining agreements (although typically, many of these contracts provide for either short-term disability or partially paid maternity leave.). In addition, the new policy only applies to workers at facilities Hilton owns or manages. It won't apply to franchises, which thereby limits the new policy's reach. As a previous Corporate Benefits Manager, with a variety of owners, management and union contracts, and franchised operations, (as well as several hotel names and licenses under the corporate umbrella), it was always challenging for individuals employed in these different settings to understand why their family and friends who worked among different properties and locations had different total rewards programs. Perhaps, some franchisees will follow suit?

What about increased costs? The company expects to incur costs, but also expects that the new policy will pay more in dividends. Executive leaders have reported that by offering this benefit they will be able to retain talent and engage employees better, which will translate to overall better customer engagement and improved customer service. In addition, costs are mitigated or offset due to union contracts, the policy's application to only certain properties, Hilton's current partially paid maternity leave policy for certain positions, as well as the fact that in certain states there is a certain level of mandated temporary disability benefits. Even so, I think it is great to see such a policy in place for companies with large hourly workforces.

It certainly is a good start, especially as we celebrate National Work and Family Month (NWFM) in October!