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Demographic trends underscore the need for human resources departments to support the employee maternity population, not only to reduce health care costs but to address a host of related expenses such as turnover, absenteeism, leave time and productivity.
The United States is among just five of 173 nations that do not guarantee paid maternity leave, according to a recent study by Harvard University and McGill University researchers.
The study suggests that U.S. workplace policies are the weakest link among wealthy nations and aren't as strong as many low- and middle-income countries.
There has been a nearly 13% increase in the number of children being cared for by stay-at-home moms in less than a decade as well as a drop in the percentage of new mothers returning to work, from 58.7% in 1998 to 54.6% in 2004, according to the U.S. Census Bureau, though it is unclear whether the drop was caused by lifestyle factors or employers' policies.
Maternity, which can account for half of all employer annual health care costs, presents a valuable opportunity for employers to build loyalty while affecting a range of related costs. Perhaps because maternity-driven expenses are ineffectively benchmarked, most employers simply hand over responsibilities for managing these programs to their health care provider. In turn, health plans often allocate the bulk of resources to the identification and case management of high-risk pregnancies, which account for less then 10% of all employee pregnancies.
It is a strategy designed to reduce provider costs while generating revenue via case management fees. Ultimately, the average prenatal education program is limited in scope, content and incentives, failing to meaningfully engage and support employees and altogether ignoring organizational goals. Many health plans do not proactively communicate the availability of such programs, while others implement opt-out enrollment strategies that do little to encourage participation.
Erasing the stigma
While employers have made great strides in the availability of post-delivery benefits such as additional leave time, flexible scheduling and telecommuting, employees who utilize these benefits often face a stigma. Most employers would deny it, but women remain reluctant to tell their bosses about pregnancy for fear of losing their job or falling off the career fast-track. It is an unfortunate reality that can trigger a sense of isolation and lack of trust.
It should come as no surprise then that the U.S. Census Bureau reports 40% of full-time employees fail to return to their prepregnancy employer within a year of a first birth.
Moreover, nearly one in four new mothers who do not return to their employer join another company, often transitioning laterally to a competitor with similar compensation, hours and responsibilities.
This means that human resources departments, already facing with a bevy of related logistical challenges, must guess about whether a pregnant employee will return to work. When she doesn't, they must then recruit and hire a replacement. It's a laborious, redundant cycle that must be addressed.
Employers conduct only cursory exit interviews, if at all, with employees who do not return from maternity leave. When queried, the simplest explanation for a departing employee is that she is staying home to care for her child, an answer that employers accept readily because it enables them to tweak the data favorably.
However, the reality is that turnover and the burden on the HR staff can be reduced by delivering meaningful support to employees, from the time the pregnancy is announced, through a comprehensive opt-in program that utilizes compelling, condition-specific incentives to encourage employee participation and reward those who return to work.
Need for incentives
The aim is to deliver consumer-directed content in various media formats--including online content, telephonic support, onsite forums, books and literature--with compelling incentives to ensure enrollment and engagement.
Employers also must communicate the availability of post-leave benefits--such as flexible scheduling, onsite child care and lactation support--early in pregnancy to encourage utilization. Furthermore, annual executive sensitivity training can reinforce an inclusive culture and help improve relationships between middle management and pregnant employees.
Employers that have implemented aggressive maternity benefits management interventions can expect anywhere from a 2-to-1 to 5-to-1 return on investment for health care costs alone. In addition, higher retention, less absenteeism, greater productivity and reduced stress will increase the overall return on investment.
According to talent management experts Bliss & Associates Inc., it costs companies as much as $75,000 to replace an employee with a $50,000 annual salary. Considering that an employee who departs at the conclusion of pregnancy leave can trigger a range of additional costs resulting from medical claims, job coverage, absenteeism, staffing and, potentially, productivity loss, maternity management must become a priority in every organization.
Aaron Crecy is chief executive officer and cofounder of MaternityCare Direct in San Diego.