We’re told that parental leave policies have little to no effect on the finances of the companies that have workers off parturiting.
This might not be quite the case:
The authors tracked specific employers and employees to see what happened to the former when the latter procreated. The findings are clear cut. Firms saw very little change in the number of hours of work done because they were usually able to respond by hiring temporary staff or increasing the hours of existing employees. Colleagues didn’t seem particularly overworked and there was no effect on the number of sick days taken.
Overall, having an employee on parental leave had little impact on wage costs, sales or the firm’s likelihood of survival.
Obviously, this was specific to Denmark’s (very generous) system. In Britain, many firms do face costs from offering more than the statutory minimum maternity pay but the study should ease the fears of any business dreading a Brexit baby boom.
Hmm, well. In the paper itself we are told this:
From the firm’s perspective, the costs of parental leave are multifold. First, in a paid
parental leave system, absent workers are entitled to receive wage replacement and firms may
have to bear these costs. However, in most high-income countries, employers are not responsible
for paying for wages of workers on leave.
In the case of Denmark, firms are reimbursed for these direct costs.Second, in order to avoid losses in productivity, firms have to either hire new workers or require existing employees to take on additional work. In a frictionless labor market without firm-specific human capital, employers are expected to fully replace workers on leave by hiring other employees at the market wage. In this case, the total costs would be equivalent to the disbursed maternity leave benefits, which then, in the context of Denmark, would be fully reimbursed.
Erm, well, no:
You are entitled to receive maternity benefit, which is a basic benefit paid by the State, when you leave work for maternity leave. However, certain conditions must be met. In addition, you are entitled to full or partial pay during maternity leave, if this is stated in your contract of employment or is agreed in some other way with your employer.
Whether you have the right to get full salary or not during your parental leave in Denmark depends on the agreements that are in place at your workplace. In some cases the employer pays the full salary during part of the period of leave, and in other cases the authority Udbetaling Denmark pays the money. Check with your employer to find out which rules apply in your workplace.
We appear to have at least some evidence that it’s the emplopyer, in some cases, that has to pay the maternity leave. Which means that a paper assuming that all is reimbursed is going to be wrong, isn’t it?
But this paper will be used to prove that maternity leave has no effect upon companies. Which is the way that social science is done these days of course.