What Happened?
Workers in St. Paul, Minnesota, will have the option of paid leave for parents through a new city employee benefits plan. St. Paul and other cities nationwide are working to increase employee benefits to remain competitive when attracting and retaining top talent to local agency roles.
Goal
According to the Star Tribune, the benefits plan that includes optional paid parental leave was developed in response to a growing number of city employers entering retirement while a low number of young talent has applied for vacant jobs. The plan aims to attract high-quality workers by offering four weeks of paid leave to an employee.
Currently, St. Paul’s 2,850 employees have access to up to 12 weeks of unpaid leave for the birth and care of a child. Enabling both parents to take time off is becoming more commonplace across the country as both parents are often working when a child is born.
The city will use $200,000 in the budget to pay for the benefit in 2015 based on paid leave rates in the past. The city council has also approved a 2.4 percent increase in property tax levy for 2015, which will also increase capital available for the benefit, the Star Tribune reported.
Cost of Time Off
Public employers, just like private employers, must take into account the cost of time off when offering benefits such as paid parental leave. A recent study conducted by Oxford Economics explained that taking time off is important to worker satisfaction and productivity levels. Enabling breaks from the standard work schedule can reduce employee stress and improve physical and mental health.
However, the study revealed U.S. workers forfeited many of their available paid time off days in fear of being fired or replaced. The data showed 169 million days of available paid time off across the U.S. workforce in 2013 were not taken and could not be rolled over into the next year. Employees took an average of 16 days off in 2013, compared to 20.3 days in 2000. The forfeiture of these days totaled $52.4 billion in unused benefits, costing an average of $504 per employee for each day they did not take off.
According to the study, the economic impact of employees taking time off is significant. If U.S. workers returned to scheduling an average of 20 vacation days a year, the U.S. economy would experience a $284 billion boost. Furthermore, employees who did not use 11 to 15 PTO days are 6.5 percent less likely to receive a bonus than those who used all available vacation time – nullifying any fears of being replaced or overlooked. This may be the result of higher levels of stress and lower levels of productivity reported by employees who leave the most PTO days unused.
A survey conducted by Robert Half found many employers may be losing high-quality workers due to dissatisfaction and inadequate benefits. The survey revealed:
- 38 percent of employees quit jobs that lack sufficient salary and benefits
- 16 percent are unhappy with management
- 9 percent feel overworked
By offering reasonable PTO for employees, and encouraging them to take advantage of these benefits, public employers can improve productivity as well as retain top talent.
Strengthening the Workforce
Gov1 has reported on a variety of workforce development strategies ranging from pregnancy benefits to wellness programs.