Baby feet
Employers surveyed by MarshMcLennan Agency earlier this year indicated staying updated and compliant with state and local laws is their biggest challenge with managing disability and leave benefits. Other challenges include integrating mandated leave, paid leave, disability and company sponsored leave benefits; manager training and understanding their role in the process; and remaining compliant with FMLA and ADA requirements, according to the survey of 1,156 employers across the country.
Most employers haven’t adjusted their eligibility requirements for disability and leave benefits over the past three years, although a notable increase in employers reported eligibility for bonding leave after 90 days, the report found. Employers continue to offer fully insured and self-insured short-term disability plans at similar rates year-over-year, said the report. Between 2024 and 2025, the percentage of employers offering bonding leave for birth, adoption and foster care rose slightly from 60% to 64%.
Most employers don’t offer caregiver leave, which provides time off for employees to care for a seriously ill family member or loved one, beyond what state and local laws require, but that is slowly changing, said the report. About 35% of employers included caregiver leave for immediate family members in their benefits this year, while 16% extended this support to other family members or loved ones. Smaller employers are less likely to offer caregiver leave.
Over the past three years, employers that offer caregiver leave have been more likely to expand who qualifies. Most employees with extended family caregiver leave increased coverage for siblings, grandparents, parents-in-law and other close relationships, the report said.
“While overall supplemental caregiver leave remains limited, the definition of who qualifies as a care recipient is steadily expanding,” said the report. “This marks a gradual but meaningful change in employer policies.”
Secondary caregiver bonding coverage is an increasingly challenging topic for employers who face legal and compliance risks. Nearly half of those surveyed said they are concerned they may face legal consequences for maintaining separate policies for primary and secondary givers. Primary caregivers tend to be women and secondary caregivers tend to be men, said the report.
Several recent lawsuits highlight the growing risk of male employees suing employers for offering shorter parental leave based on gender. Typically, separate caregiver coverage is designed to provide more paid leave to the birthing parent.
“Employers can maintain this approach, but it should be reframed to align with EEOC guidance,” said the report. “For example, employers might use pregnancy disability benefits to offer additional leave for birthing parents through plans that don’t differentiate between ‘primary’ and ‘secondary’ caregivers.”
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