You're a Startup with No Parental Leave Policy- 5 Tips From an Expert

As originally seen in Mogul

So, you have an all-star female performer.  She was maybe your #5 hire.  She’s critical to the success of your startup.  Then she tells you she’s five months pregnant.  You have no maternity or parental leave policy in place.  Heck, you just got that benefits package in place.  Your mind is blown.  What do you do?  You are still building.  Money is tight, but you want to keep her.  Even more, you want to do the right thing. 

This is a really common “event” in the startups I work with.  Having a pregnant employee can be a huge shock to an already super lean organization.  And I get it.  The ship needs to run on all cylinders.  Having one person gone for an extended period of time can be really overwhelming.

However, let me blow your mind even further.  The odds are already stacked against you: nearly HALF of all women after having their first child do not return to their company.  You heard that correctly.  ALMOST HALF.  And it’s not because they don’t want to work.  On the contrary, 86% of women desire to work after their child’s first year.  But they simply don’t feel they can. 

Lack of adequate maternity leave is one of these reasons why women don’t come back.  And that’s just one of the many reasons.  However the other one you need to know about has nothing to do with promotion or pay.  The degree of social support a woman receives from her direct manager and colleagues transcends all other financial incentives.

As a result, if you don’t take the bull by the horns and get this right, you can say bye-bye to Miss Rockstar.  She may go to another company or she may start her own business.

According to the Institute of Women’s Policy Research (IWPR) women are steadily increasing their presence in the world of small-business ownership. About 29% of America's business owners are women, an increase of 26% from 1997. The number of women-owned firms has grown 68% since 2007, compared with 47% for all businesses. 

So here’s some advice to keeping Miss Rockstar:

1.     Evaluate the Numbers: Obviously having a good parental leave policy is in of itself a good thing.  However when budgets are tight and you need to make the financial case to investors or your board, it’s important to be aware of the numbers.  Here is the cost of turnover: For those earning $30,000-$50,000/yr the cost of turnover is 20% an annual salary.  For those earning over $50,000/yr the average cost of turnover is 213% an annual salary.  This doesn’t take into account wasted time recruiting and training a new person

2.     Include Her on the Process: Not having a policy already in place is not necessarily a bad thing.  Have your expecting employee co-collaborate with you in determining policies. Why is this a good idea?  Miss Rockstar will feel valued, that her opinion matters, and is more likely to stay if she’s part of the policy creation. 

3.     Be Inclusive: Think about policies where leave is given to both partners.  Some firms unintentionally signal who should be primary caregiver vs. breadwinner when they only offer 1-2 weeks paternity leave and 3 months maternity leave. 

4.     Think Long Term: Miss Rockstar may be your only expecting mama right now, but chances are she won’t be your last.  According to a poll in Gallups, 94% of women either have children or desire to have children in the future.  Only 6% of women aged 18-40 consider themselves voluntarily childless (not wanting children). 

5.     Change your Attitude: I will be honest.  Anecdotally, the startups I have worked with view this “situation” as a total inconvenience.  They only want my help because they need a quick fix to a real problem.  This is incredibly short-sighted.  In a time where gender diversity is in the spotlight, where we have a statue of a defiant girl on Wall Street symbolizing the need for gender equality, and when women are fighting hard for their right to be both a mom and have a career, it’s of paramount importance you also hop on the #GIRLPOWER train. 

I never said keeping your female talent was easy.  I said it’s Worth It.