With an eye toward boosting its attractiveness to top talent in the U.S. and China, Volvo Cars will extend its generous paid parental leave policy to its entire global work force starting April 1.
The Family Bond policy, which Volvo trialed in Europe in 2019, will give employees with at least one year of service a total of 24 weeks of leave at 80 percent of their base pay, the company said Tuesday.
The policy applies to either parent and the leave can be taken anytime within the first three years of parenthood. In addition, the person returns to his or her job after the leave period ends.
Volvo employees in the U.S. and China, where the automaker has expanded rapidly by opening vehicle production plants in the last decade, stand to significantly benefit.
In the U.S., Volvo employees were previously offered six weeks of parental leave at 100 percent of their salary. Starting next month that rises to either 19 weeks at 100 percent or 24 weeks at 80 percent of their salary.
In China, mothers have a minimum of 14 weeks of paid leave while fathers, on average, only get one week. Volvo previously offered dads in China 15 days of leave at their full salary. That number will rise by more than a factor of 11.
“For the dads in China it will be a revolution,” Volvo CEO Hakan Samuelsson told Automotive News Europe.
Volvo knows it will not be cheap to offer the program to its 40,000-plus employees around the world.
“It’s a lot of money,” Samuelsson said, “But we are quite sure it’s a good investment.”
The benefits he foresees from the program include retaining top talent, especially female executives. He expects this will result in a more diverse, more agile work force.
“We want to think outside the box and not just do everything like everybody else does,” he said. “For that you need diversity, because a company run only by 55-year-old guys from the same town won’t have too many new ideas.”
While Volvo board member Hanna Fager expects the policy to help keep more women in the work force, she also hopes that male employees around the world take advantage of the program.
“We aim to create a cultural mind shift,” Fager told ANE.
Volvo has already seen this happen in its Europe, Middle East and Africa region, where she said nearly half of the participants in the program are men.
“That is the highest that we have ever seen,” said Fager, who as head of corporate functions leads Volvo’s human resources.
When asked how long it took Volvo to decide to offer the program globally, Fager said she and Samuelsson started discussing the topic last September. In January they committed to moving forward.
Four months later the program is ready for launch.
One of Samuelsson’s only regrets is that such a program wasn’t offered when he was starting his family.
“When I was in that situation very few men had the opportunity to really take the time off,” he said. “If I could go back, I would really see the value of doing that.”