It seems the voices in favor of mandatory paid maternity leave are growing louder. At least, as I scan Facebook and Twitter, then frequency with which the topic gets raised and debated is clearly on the rise.
Typically, the “in favor” proponents seem to repeat a few key ideas in a variety of ways: “Companies should invest in future generations,” “It’s hard enough for a working mother to make ends meet without greedy corporations making it harder by not paying for maternity leave,” and of course the classic, “The U.S. is the only developed nation that doesn’t have mandated maternity leave.
These are nonsensical, liberal arguments that unjustly vilify corporations. Why are companies the enemy? Let’s start by understanding the purpose of corporation in the first place: a company exists because a person or group of people saw a need in a market and an opportunity to profit by satisfying that need. The investors in that company have put money into it with the hope and expectation that they will see a positive return on their investment through future profits earned through the sale of products and/or services provided by that company. In the process, the company buys equipment and materials and services (helping other companies flourish in the process), and hires individuals to complete tasks (creating jobs for those people).
And that’s it. That’s their purpose – to generate a profit for their investors. With that as the core purpose, other tangential benefits arise, like increased employment, increased taxable income and more. Some companies do well enough that they give to their local communities, or get involved with various charities, and that’s their choice to do so, when they feel financially able to.
Similarly, some companies offer generous benefits, such as paid maternity leave, as a means of attracting the best talent. Companies that can’t afford this benefit either need to settle for lesser talented employees, or offer other benefits that may be more affordable to them, and similarly appealing to potential employees. It’s basic principles of supply and demand – without the need for the government forcing a company’s hand.
Employees typically understand the benefits package a company offers before they accept an offer for employment. It’s selfish and petty to accept a job under a specified set of conditions, only to whine about those conditions later, when your own situation changes and the benefits package you once agreed to is no longer convenient for you.
The reality is, for many companies – of all sizes – paid maternity leave is simply too expensive. It’s not unusual for companies to run on very tight budgets, with little wiggle room for additional expenses. Hard working entrepreneurs everywhere often work without taking a salary for long periods of time in order to stay afloat and realize their vision. Paying three months salary to a suddenly non-productive employee simply because they made the decision to have a child would strain many small businesses beyond the brink of insolvency. If maternity leave was mandated, many companies would have to make up the difference by laying off other employees, or raising prices of their products and services, ultimately hurting consumers.
And what of the other employees, who are not having babies? They would be, in effect, punished for not having children by virtue of the fact that their salaries would be lower than a pregnant woman per productive hour. Consider a situation in which a two employees make the same annual salary. One employee gets pregnant and takes three months maternity leave, during which the company is forced to pay her full salary. If the annual salary is calculated on a per-productive-hour basis, the employee on maternity leave, having fewer productive hours than her co-worker, ends up making more for each hour actually worked – the employee who didn’t choose to have a baby is punished for not having a child and working three months longer. Inevitably, this will cause that employee to complain, and demand either higher salaries to make up the difference, or want similar paid leave – two options that will negatively effect the company, overall employment and prices charged to consumers.
If a person decides to have a child, that’s their prerogative – nobody can tell them whether they should or shouldn’t do so. But like any major decision, people need to consider the expense, and determine whether or not they can afford it before forging ahead. It may be that having a child simply isn’t an economic option at the time, or other things, like vacations or other luxuries, need to be reduced or eliminated to make it work financially. But why, simply because a company employs a person, does economic responsibility for that child transfer from the person to the company? If that’s considered to be rational, then why stop at the company the person works for? Ultimately, their salary will go toward paying the rent or mortgage, the car payment, the utility bills, and the grocery bills (including diapers and formula for the newborn). So shouldn’t we also expect that landlords should forgo rent for three months after the birth of a child; banks should forgive mortgage payments during that time; car dealerships should not accept payments; water, heat and electricity should be provided free of charge; and Pampers and Gerbers should provide every new mom with free baby products? Why should these entities get paid in full during a new mom’s maternity leave, but the company she works for be punished to capacity by paying for a long period of non-productivity?
Companies provide products and services and create profits. Mandating maternity creates an undeserved burden on entrepreneurs and investors, while punishing people who have not chosen to have children, pushing prices and higher, and reducign employment and productivity.