Brokers are key to helping employers navigate the complexities of paid leave

Access to paid family medical leave (PFML) continues to increase. As of 2023, 27% of private-sector U.S. employees have access to paid leave, more than double the 12% total in 2014, according to the U.S. Bureau of Labor Statistics. While the increase can be partially attributed to the passage of local, state and federal paid leave regulations, employers are also driving the increase by expanding the leave benefits they offer to employees.

More than a dozen states have implemented paid family and medical leave laws or programs in recent years. Some are required while others, such as the state of Vermont, are voluntary.

“In addition to the state programs, we are seeing many employers expand their company paid leave programs to provide flexibility and meet the needs of their employees, as well to help attract and retain new workers,” said Sharon Andrus, head of PFML at The Hartford. “Being productive at work requires the flexibility to manage personal and family needs and paid leave benefits provide peace of mind for employees. Knowing your income won’t stop when you are on a covered leave can help people worry less about how they will make ends meet – and focus more on their own recovery or caring for their loved one.”

The expanded access to paid leave benefits comes with added complexity for employers and employees seeking to optimize the benefits. The Hartford’s 2024 Future of Benefits Study finds that 41% of employers rely on their insurance broker to help stay compliant with federal, state and local leave laws and regulations.

Brokers have a unique opportunity to help their clients understand and optimize paid leave benefits by offering services that simplify leave administration, educate employees and increase overall utilization.

Expanded access, added complexity

Paid leave programs are among the top benefits that aid employers’ talent retention and recruitment strategies. The Hartford’s research shows, 58% of employers cite paid time off (PTO) benefits as a top recruiting and retention tool, with paid maternity (43%), medical (42%), family (38%) and parental leave (30%) benefits not far behind.

Across each of these leave types, many employers report adding or expanding benefits beyond state and federal requirements in 2024, according to The Hartford’s study.

“Providing a comprehensive benefits package that includes paid family and medical leave benefits can help employers attract and retain employees,” explains Andrus. “The increased access comes with a lot of behind-the-scenes work to coordinate the different benefits, such as PTO, the federal Family and Medical Leave Act, state and company paid-leave programs, and income protection benefits. The complexity is even greater for employers operating in multiple states.”

Brokers can play an instrumental role in helping employers navigate administrative complexities, including decisions about whether to opt out of state leave plans or offer a private plan through an insurer or third-party administrator. When employers go with a private plan, brokers provide essential support to help secure private plan approvals and ensure coordination between the leave plans and existing income protection (disability) benefits.

Employers are looking for a wide range of help. The Hartford’s study reports that 89% of employers would welcome help tracking all types of leaves in one place, and 88% would like assistance to ensure compliance with federal and state regulations. Significantly, employers are also seeking help in educating employees about their paid leave options and how to use them.

Employee expectations – and concerns

The Hartford’s research also shows that 85% of U.S. workers believe paid leave benefits help companies attract and retain workers, and two-thirds say their employer provides a good work-life balance that allows them to take time off to care for their family.

One in three, however, believe there is a negative perception associated with taking a leave. Concerns are higher among Gen Z employees, with 49% saying they are fearful of workplace repercussions if they take a leave compared with 24% of Boomers.

“Employers need to create an environment in which employees of all ages understand the leave benefits available and feel supported in taking time off to care for themselves or a family member,” Andrus said. “The more people see their colleagues being supported through a leave of absence and the transition back to work, the more comfortable they will be about using the benefits themselves.”

Along with culture, education is vital for increasing employee awareness and utilization. Today, only 26% of U.S. workers say they are very confident they would know how different leave types would work together if they needed to take a leave. Again, brokers can provide valuable education, communications and support to help employees understand their leave benefits, how state leave programs work with other income protection benefits offered by their employer and how to file a claim.

The pivotal role for brokers

Brokers can add significant value for their clients by offering expanded support and services that address administrative, educational and utilization needs.

The Hartford’s research demonstrates that employers rank brokers among the top five resources they rely on to stay compliant with federal, state and local leave laws. As trusted advisors, brokers are well-positioned to help their clients make informed decisions, simplify experiences and optimize paid leave programs.

Paid Family and Medical Leave programs can vary depending on location. Learn more details and differences of each state’s program here (Paid Family & Medical Leave | PFML | The Hartford ).

Ann Clifford is a freelance writer who translates her background in financial services marketing into specialized content focused on employee benefits and small business topics.