Why paid leave should be on your HR roadmap

As we get further into 2025, it's crucial for HR leaders to re-evaluate their company paid leave policies. Over the last few years, the landscape of employee benefits has rapidly changed, with paid leave emerging as a pivotal factor in attracting and retaining top talent. 

Recent research from Cocoon paints a compelling picture of how crucial paid leave has become. In a nationwide survey of over 1,300 participants, a striking 60% of respondents indicated that a lack of a competitive paid leave package would be a deal-breaker when considering a new job. Even more surprising, potential job seekers ranked a comprehensive paid leave package as their second priority — above a competitive salary. The number one priority was 100% covered health insurance.

Even as state guidelines for leave evolve, they still fall short of providing comprehensive support for employees. For instance, bereavement leave policies can be extremely narrow, sometimes only recognizing losses within very specific familial definitions. This leaves many employees facing an impossible choice between maintaining their job and taking necessary time away.

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My peers in HR and people operations don't need to be convinced of the importance of paid leave. But getting sign off from executive leadership so that HR teams are empowered to update these policies is often easier said than done. Data on leave policies from employers who manage their leaves through Cocoon might help us make the case. As HR leaders, we can make the business case for paid leave policies by educating leadership to understand what a competitive leave policy is and the benefits of having one.

The big takeaway from 2024: Paid leave is a core benefit, not just a perk 
Leave policies among our customers have been steady since their post-pandemic expansion, suggesting that more employers recognize the importance of providing generous, inclusive paid leave policies that meet the diverse needs of today's workforce.

Read more:  Why employers should add SAFE leave to their PTO options

There are a few trends that signal how employers are thinking about comprehensive paid leave that may prove the point to leaders:

• More employers are expanding leave types beyond what's covered through FMLA: Data from Cocoon shows that nearly 25% of employers now offer paid caregiver leave, a 15% increase since 2023. The fact that caregiver leave is gaining traction makes sense, with 22% of U.S. adults working full time and providing caregiving (this figure is up 21% since 2015).
  
• Employers are also increasing access to leave in general: Since 2022, the median medical leave offering is up 76% (up to 6 weeks from 3.4 weeks). While parental leave is often the most talked about leave type, 55% of FMLA usage is for medical leave. This recognition from employers is significant. 
  
• More than half of employers now offer paid leave starting day one on the job — no tenure or seniority required. If a candidate is considering a job between two different companies, and both offer the same amount of paid leave time — but have different tenure requirements — that could be a deciding factor for them that could have a long-term impact on hiring.
  

Expanding paid leave pays off for everyone
It's a long-held assumption that the people who take and value paid leave are predominantly women. But our survey research reveals that men were equally — if not more — interested in comprehensive leave policies. When males aren't satisfied with the amount of paid leave they're given, they're more likely to leave a job: 68% of males say paid leave has impacted their decision to leave a job in the past, versus only 42% of females. The misconception of leave as a women's issue is the tip of the iceberg when it comes to how underprepared we are to support the needs of our employees overall. This underscores the importance of crafting policies — such as compassionate leave — that are designed to be more inclusive of employees who may not need traditional leave types, like parental and medical. 

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Surprisingly, paid leave is sometimes as important, or even more than, compensation: Paid leave was the second most sought after benefit, above competitive salary, in our survey results. Considering that good talent can be costly for employers — and that this is a benefit job searchers prioritize — offering generous paid leave is an important lever that employers should use to recruit top talent. 

Perhaps the strongest case to make to executive leadership is that comprehensive paid leave could help address voluntary turnover. As we know, backfilling can cost employers up to double a former employee's salary, so moving the needle here is business critical. Among survey respondents, 70% said a generous paid leave package would make them stay at their current employer. This aligns with what we see among our customers, where the median employee tenure of employees who have taken leave is 25% longer than those who haven't taken leave (that's nothing to sneeze at!). Companies can also influence the likelihood that an individual employee comes back after their leave based on the experience of taking leave. 

Looking ahead, employers that recognize the importance of and act on updating their paid leave policies will be better positioned to attract, support, and retain top talent. By providing flexible, comprehensive leave policies, organizations can demonstrate genuine care for their workforce, ultimately creating a more engaged, loyal, and productive team.