Business accounting in Maryland changes with the tide as new laws take effect each year. How have your human resources and accounting departments adjusted to Maryland’s Parental Leave Act (PLA)?
What the PLA means for business accounting in Maryland
As of Oct. 1, 2014, the PLA requires Maryland employers with 15-49 employees to provide up to six weeks per year of unpaid parental leave following a birth, adoption, or foster placement. Remember these three Bs as your company adjusts to the new law’s effects.
Budgets, Benefits, and Bringing Employees Back on Board
(1) You’re gonna need a bigger budget.
It’s difficult enough to predict possible employee pregnancies. But with the new law covering both men and women for births, adoptions, and foster placements, almost any employee could be a potential candidate for leave. Because parental leave is so difficult to budget for, your company will likely face at least a few unexpected requests for unpaid leave in the next few years. And if you’re in an industry that demands you meet deadlines, any lost productivity could cost your company its reputation, possible requiring thousands of additional dollars to repair your image.
(2) Benefits could take a bite out of your bottom line.
Absent employees create workflow gaps that can disrupt essential processes, especially when those employees possess knowledge and skills that no one else in the company has. When you lose a key employee even for six weeks, your company has tough choices to make. You could decide to pay your remaining employees overtime to pick up the slack. Or you could try hiring a temp. Though hiring a temp does require time and effort, the temp agency will pay for that person’s benefits. Your company must continue to pay for the benefits for any employees that are on unpaid leave.
(3) Bringing employees back on board can be costly.
Businesses that employ between 15 and 49 employees are relatively small. But they can achieve a lot in just six weeks. What has your company achieved during the last month or so? Maybe you underwent staff training for an exciting new tech initiative. Or maybe you executed a re-branding that’s been in the works for years. It’s impossible to predict everything your employees will miss while they’re on leave. But you can be sure that it will cost you additional time and money to bring them up to speed when they return.
Communicating Your Benefits Expenditures to Employees
If you’re lucky, your employees respect the hefty sum you pay to fund their benefits. Unfortunately, many employees don’t bother looking beyond their pay stubs. Schedule a meeting with your employees to discuss their benefits and how much they cost you. Your employees may be motivated to work harder once they realize how much you are contributing to their needs outside of the workplace.
Help with Business Accounting in Howard County
bgr CPAs is celebrating our 76th year of serving businesses in Columbia, Ellicott City, and other locations in Howard County, Maryland.
For more information about accounting services for Maryland businesses, please call bgr CPAs at (410) 418-4400 (Baltimore) or (888) 792-3600 (Washington/Metro).