News Family

Report: Corporate Paid Leave Policies Shortchange Most Workers

Nicole Knight

A new report highlights racial and income disparities in paid leave policies, as paid-leave inequity hits the workers who can least afford it.

When Starbucks announced in January an 18-week paid family leave policy, the much heralded news left Jess Svabenik feeling undervalued.

That’s because Starbucks extended the generous leave benefits to corporate workers and store managers, not to baristas like Svabenik, who is seven months pregnant. Baristas can only take up to six weeks of paid parental leave under the new policy.

A report out Wednesday by the advocacy group Paid Leave for the US suggests Starbucks’ unequal policy is common. The report finds many major employers provide significantly more paid family leave to corporate employees, while shortchanging hourly, part-time, and other low-wage employees of paid leave to care for a child.

“Every day we get up, a lot of us very early … to serve coffee and to make sure that our customers are taken care of,” said 37-year-old Svabenik, who makes $11 an hour at a Starbucks in Silverdale, Washington. “To feel like that’s not as important as the work that somebody is doing in the corporate office is frustrating and disheartening.”

Appreciate our work?

Rewire is a non-profit independent media publication. Your tax-deductible contribution helps support our research, reporting, and analysis.

DONATE NOW

Brianna Cayo Cotter, chief of staff with Paid Leave for the US, said the organization conducted research among 35 of the nation’s largest employers to better understand what kind of workers have access to paid family leave.

“I think Starbucks is probably the best example of this, where they got tons of positive press that was like ‘Starbucks ground-breaking policy 18 weeks for moms!'” Cotter told Rewire. “But when you looked closer, that 18 weeks for new moms only applied to 3 percent of its workforce … because it’s only the corporate moms.”

Of the 22 major companies that responded to the organization’s inquiries, six admitted their paid leave policies for low-wage workers were less generous than policies for higher wage employees. Thirteen companies, including such well-known names as Trader Joes, refused to disclose their policies to Paid Leave for the US.

Cotter said shrouding paid family leave policies in secrecy doesn’t help workers who rely on their jobs for paid leave benefits.

Paid Leave for the US found that Walmart, the nation’s largest private employer, offers 12 weeks of paid leave to birth mothers who are corporate employees, but only six to eight weeks at partial pay for birth moms who are hourly store employees. Yum! Brands, the parent company of KFC and Pizza Hut, provides 18 weeks paid parental leave to birth mothers, and six weeks to fathers and adoptive parents in the corporate office. Field employees receive no paid family leave.

The report notes that paid-leave inequity hits the workers who can least afford it. Individuals earning more than $75,000 annually are twice as likely to have paid leave than those making under $30,000. Almost half of new parents who lack fully paid parental leave and earn less than $30,000 a year sought public assistance to make ends meet.

“Because we lack a federal paid family leave policy and only 13 percent of workers have access to paid family leave—and that number drops to 6 percent of low-income Americans—the majority of people who get paid leave get it from their employers,” Cotter said.

The report indicates that nationwide access to paid family leave has fallen over the last decade.

Four states—California, New Jersey, Washington, and Rhode Island—have laws on the books requiring paid family leave, Cotter said. New York and Washington, D.C. have passed paid leave policies that are not yet in effect.

The report highlights racial disparities in paid leave policies. At Walmart, Blacks or Latinos are three times more likely to be a service workers, meaning they qualify for less paid family leave. Forty-two percent of Walmart’s U.S. workforce are people of color, up from 39 percent two years ago.

Cotter said the goal of the report is to advocate for paid family leave at the federal level.

Jasmine Dixon, a former overnight stocker at a Denver Walmart, told Rewire she lost her apartment because she had to take about a month of unpaid leave when her infant son was hospitalized. The company didn’t provide her with paid family leave. The 23-year-old said she made ends meet by relying on aid from food banks and churches.

“I just wish I hadn’t had to stress about providing the basic needs for me and my children,” Dixon said.

Research underscores the serious health benefits of paid leave. A 2011 study showed that ten additional weeks of paid leave could reduce infant mortality by as much as 10 percent. Studies have found paid leave policies increased the number of well-baby doctor visits and vaccinations, and increased the duration of breastfeeding.

Load More

Freedom of the press is under attack right now. Support fact-based quality, independent journalism today. Sign up for our email list.

Thank you for reading Rewire!