More and more private employers are expanding their parental benefits policies as one tool in their strategy of attracting the best job candidates and of increasing employee retention, morale and productivity. These policies can close the gap in job-protected leave for employees ineligible for leave under the Family and Medical Leave Act (FMLA), or increase paid and unpaid benefits regardless of FMLA eligibility. In fact, 2017 has seen a boom in the addition of such benefits by some of the nation’s largest employers, including Netflix and Facebook; Mark Zuckerberg famously took two months off when his daughter was born. But despite what may be the best of intentions, if employers don’t develop and implement these policies in the proper way, they may face legal consequences.
Case in point: recent litigation launched by the Equal Employment Opportunity Commission (EEOC) against one of the country’s largest cosmetics companies, Estée Lauder. The lawsuit alleges that the company violated federal law when it implemented and administered a paid parental leave program that automatically provides lesser parental leave benefits to male employees who are new fathers than to female employees who are new mothers. Estée Lauder has not yet responded to the litigation, which seeks injunctive relief, back pay, liquidated damages and compensatory and punitive damages.
According to the lawsuit, Estée Lauder adopted a new parental leave program to provide employees with paid leave for purposes of bonding with a new child. This “bonding” leave is provided in addition to the paid leave already provided to new mothers to recover from childbirth. The policy provides new mothers who have given birth with an additional six weeks of paid leave for bonding purposes, while it offers new fathers whose partners have given birth only two weeks of paid leave for child bonding, designating that as “secondary caregiver” leave. New fathers are only eligible for the six-week primary caregiver leave in surrogacy situations. Further, the suit alleges that new mothers are provided with flexible return-to-work benefits upon the expiration of child-bonding leave that are not provided to new fathers.
The EEOC’s litigation stance is in keeping with its prior Enforcement Guidance on Pregnancy Discrimination and Related Issues, which states that “parental leave must be provided to similarly situated men and women on the same terms.” The guidance further states that if an employer provides leave to new mothers to bond with and/or care for the child beyond the recuperation period for childbirth, it must provide an equivalent amount of leave to new fathers so that they too can bond with and/or care for the child. There may be more similar suits to come. Enforcement of equal pay laws, including targeting compensation systems and practices that discriminate based on gender, is one of six national priorities identified by the EEOC’s Strategic Enforcement Plan.
The lawsuit also comes at the same time that more and more state and local governments are mandating paid and/or unpaid parental leave benefits. California, New Jersey, Rhode Island and San Francisco already have legislation on the books. Other jurisdictions, including New York, Washington and Washington, D.C., have enacted paid parental leave laws that will go into effect in the coming years. There are ongoing efforts to do the same at the federal level and in at least 15 other states.
The bottom line is that employers must craft policies carefully to ensure that good intentions don’t lead to unintended consequences. Parental leave benefits given to mothers that are not related to pregnancy, childbirth or related medical conditions must be offered to fathers as well. Otherwise, the failure to provide equal benefits may violate Title VII, the Equal Pay Act and/or state or local employment laws.
Employers who provide different tiers of parental benefits must also be careful in how they define eligibility for the tiers. For example, some policies use the terms “primary caregivers” and “secondary caregivers” as a way of distinguishing between the types of benefits that are provided. These designations appear gender-neutral on their face; however, they must also be applied without regard to gender stereotypes. Fathers may be the primary caregivers, for instance. Moreover, employers must be prepared to address how such designations apply if both parents claim to be co-primary caregivers, equally sharing in the responsibilities of providing care for the child, and how such designations apply in the context of same-sex parents.
As employers decide whether to (or become required to) provide enhanced parental leave benefits, it is essential that they craft their policies with care and consult counsel as needed. Employers must make sure that their policies and policy updates comply with all applicable federal, state and local requirements. If employers choose to be more generous than the law requires, they must still draft policies that are gender-neutral, paying attention to conscious and unconscious bias. Finally, they must train managers to consistently administer and apply these policies in a proper manner, to avoid unlawfully discriminating against employees on the basis of gender.