Adoption Benefits

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Adoption Benefits: Employers as Partners in Family Building

Laura Michaels, 33, has been a secretary at the Campbell Soup Company in Camden, New Jersey, since 1982. Three years ago she and her husband, Jim, decided to adopt a child. Because Laura's sister has Down syndrome, she and her husband wanted to provide a home for a child with "special needs."

Soon after completing their adoption study, they were introduced to Gary, a 10-year-old boy with cerebral palsy and learning disabilities. Gary had been waiting for 3 years, since his parents relinquished him, for someone to give him a permanent home.

Laura and Jim wanted to adopt Gary, but knew that both of them would have to take time off from their jobs to help Gary adjust. Fortunately, Laura's employer offered adoption benefits. Not only would her company reimburse her for up to $2,000 of any adoption-related expenses, it would give her a combination of paid and unpaid leave.

Campbell Soup is one of a growing number of companies in this country that offers some kind of adoption benefit to its employees. In some cases, it is a financial stipend to cover some or all adoption costs. In others, it is a policy that allows for adoption leave (similar to maternity or paternity leave) so that the child and parents can have time to adjust to each other.

Today, 2 million childbearing-age couples and 1 million single persons are interested in adopting children. Adoption, once the province of infertile couples seeking healthy infants, has changed. Adopters include many single, first-time parents and couples who choose to add to their families through adoption. Many of the children being adopted are older, have disabilities, or are brothers and sisters who want homes together. The children come from the United States as well as from a variety of foreign countries.

As adoption has gained in acceptance as a way to begin or expand a family, employees and employers have become more interested in adoption benefits. Indeed, many prospective parents, especially those who are single, could not adopt without the support of their employers.

Laura says that she and her husband could probably not have considered adoption, especially of a child like Gary who needs special attention, if not for the financial and emotional support of her employer. "The money is wonderful," says Laura, "but equally as important was knowing that my company was behind me, that I could take a reasonable amount of time off from my job and that it would be waiting for me when I was ready to return in two months."

While maternity benefits are standard in most health care programs, adoption benefits have a long way to go. Yet, they are just as much needed. In addition to needing financial help, Laura suggests that adopters need to know that their employer is committed to family life and is willing to allow the time necessary for a child and parents to establish and build a relationship.

In 1990, a survey conducted by Hewitt Associates reported that 98 of 837 major U. S. employers (12 percent) provide employees with some type of adoption assistance. The numbers may not seem large; they show, nevertheless, a significant increase over previous years and a growing recognition of the higher priority the workplace gives to family concerns.

Women in the workplace particularly welcome corporate support for their decision to adopt. Traditionally, women have suffered both emotionally and financially after the birth or adoption of a child. A recent study by the Institute for Women's Policy Research reveals that working women who bear or adopt children lose earnings of $31 billion annually. Those who have no leave time benefits available incurred an additional $607 million loss in earnings.

Adoption Benefits Plans

An adoption benefits plan is a company-sponsored program that financially assists or reimburses employees for expenses related to the adoption of a child and/or provides for paid or unpaid leave for the adoptive parent employee. Financial assistance may be reimbursement for specific costs or a set amount of money, regardless of actual expenses. Adoption leave may be paid or unpaid and provides the time following the adoption for the parent to help the child bond and feel comfortable. Some companies offer a combination of financial help and leave time.

Often, companies offer adoption-related benefits, but they are not part of a separate adoption benefits plan. They may be offered under general employment leave or maternity/paternity benefits.

As part of their adoption benefits package, a growing number of companies are contracting with human resources consulting firms to provide their employees with adoption information, support, and referrals to licensed adoption agencies and organizations. An adoption specialist is available by telephone to answer questions about the adoption process, types of adoption, locating and selecting an agency, and managing special situations, such as stepparent or legal risk adoptions. The Partnership Group in Lansdale, Pennsylvania,

Work/Family Directions, Inc., in Boston, Massachusetts, Working Solutions, Inc. in Portland, Oregon, and the Dependent Care Connection in Westport, Connecticut, are some of the human resource organizations that provide this assistance. Among the major corporations that offer this benefit are Aetna, AT&T, DuPont, Hewlett-Packard, IBM, Johnson and Johnson, and Microsoft.

Why Would a Company Offer Benefits?

Equity: Two of the most compelling reasons for a company to offer benefits are equity and fairness. Employees who choose parenthood through adoption should receive benefits comparable to those who have children biologically. We've always paid excellent maternity benefits, and we felt that adopting parents also have certain needs that we want to meets says Lia Brassord, manager of employee insurance at Stanley Works of New Britain, Connecticut.

Low cost: Since few workers actually utilize the benefits, the cost to the company is low, assuring compatibility with cost containment concerns. An informal survey of companies shows that fewer than 2 percent of all employees use the adoption benefit. "We have found this benefit to be very well received by employees, and very cost-effective. We currently experience from two to six adoptions per year. I would endorse the adoption allowance to any employer contemplating it," states Michael McDermott, Senior Director of Human Resources, G.D. Searle & Co., Skokie, Illinois.

Good will: The company receives a lot of good will and positive publicity for its sensitivity to its employees. In addition, workers tend to feel greater loyalty when given this extra consideration. This may lead to a lower company turnover rate. "Benefits come from the needs of people. With something like adoption assistance, employees appreciate its existence and employers benefit from the good will it creates," says Christine Seltz, Consultant, Hewitt Associates, Lincolnshire, Illinois.

Social benefit: Children and families are the beneficiaries of the company's support of adoption. The benefits may make the difference in a decision to adopt, which can be particularly meaningful for the growing number of available children with special needs who live in foster care or institutions. "Everyone benefits from an adoption benefit plan: the community, the company, and the employees," exclaims B. Miller, Vice President, Human Resources and Compensation, with a Chicago-based communications firm.

Acceptance by companies: More and more companies are offering benefits packages and many want to keep pace with their colleagues. In addition, legal actions have consistently supported the equity consideration.

An executive at the Xerox Corporation says that company benefits made "a world of difference" when she adopted two boys from Korea 5 years ago.

"When we adopted," says Susan, "the total cost was $5,000, and Xerox defrayed $2,000 of that. I thought it was great-a very appropriate ratio for them to cover. It showed me that Xerox supported family values and was serious about helping me to have the family I wanted."

Wendy Starr, Manager of the Life Cycle Programs and Policies at Xerox in Stamford, Connecticut, says, "The program is very well received here. We average about 50 people a year using it. Some years we've even had up to 75 people take advantage of it." In 1979 when the program started, Xerox reimbursed $1,000 of the adoption costs; now they will pick up $3,000 of the bill.

An executive from Xerox's Human Resource Department who adopted says, gAs a personnel manager I was well aware of the benefit program, and I knew that Xerox was extremely sensitive to adoption as an option. The fact that they just increased their reimbursement proves that. They also gave me a leave of absence. I can't speak highly enough of management's commitment. It's there whether you adopt or have a baby biologically." She adds that, "The company doesn't just send you a reimbursement check, but a very nice personalized letter. It's an excellent benefit."

Who Is Eligible for Benefits?

Adoption benefits are usually available to all regular employees. In some cases, the employee needs to have worked for the company for a specific amount of time; in others, enrollment in a company insurance plan is required. The designations used by many companies for those eligible are full-time salaried Permanents or "regular" employees.

How Do Plans Actually Work?
What Expenses Are Covered?

Coverage varies widely, with benefit amounts ranging up to $6,000 per adoption. The most common approaches are:

? Reimbursement for specific expenses;

? Specific "set" allowance, regardless of expense; or

? Reimbursement or coverage through the company's medical plan for medical expenses only.

Most often, employees are reimbursed for a given percentage (80 percent appears to be the norm) of specific itemized expenses. Virtually all plans have a ceiling, with the median reimbursement being about $2,000. The most frequently covered expenses are public and private agency fees, court costs, and legal fees associated with the adoption. Newer policies have broadened coverage to include foreign adoption fees, medical costs, temporary foster care charges, transportation costs, pregnancy expenses for the birth mother, and counseling fees associated with the placement and initial adjustment.

When a specific allowance is offered, employees receive a lump sum regardless of actual costs. Allowances usually range from $500 to $1,000, with more companies paying at the higher end. If more than one child is adopted, some companies pay only one allowance while others pay an allowance per child.

The least common approach covexs only the medical costs of adoption through company medical insurance plans. So far, this approach has been used only in specific, limited situations with tightly defined eligible medical expenses.

It may also be possible for companies to provide coverage for adoption-related legal expenses bv including adoption in company-sponsored group legal plans for employees.

When Are Benefits Paid?
In most cases benefits are paid after the adoption is finalized. Some companies, recognizing the accumulating expenses and the need for a child to live in the home prior to finalization, are providing reimbursement earlier-when the child is placed in the home or as expenses are incurred. The reimbursement for the adoption of children with special needs is paid after finalization.

Are all types of adoption covered ?

In cases where a stepparent wants to adopt, only about half the companies surveyed in a 1980 study covered adoption costs. Among plans implemented more recently, the trend is toward including all adoptions.

Some of the companies surveyed by the U.S. General Accounting Office in 1989 (67 companies, 7 Federal Government agencies, and 3 nonprofit organizations), had an age limit on the adopted child that determined whether benefits would be paid. Most of those with age limits specify the child must be under either 16 or 18 years of age.

How Do Adoption benefits and Maternity Benefits Compare?
While most companies recognize the need for &imess to all employees, adoption benefits have not kept pace with maternity benefits. Since regulations require that pregnancy be treated as any other disability, reimbursements through medical plans have dsen dramatically. This has not been the case for adoptions, since an adoptive parent is not "disabled" by parenthood. Yet, there are companies that try to parallel maternity benefits by steadily increasing the adoption reimbursement. At least one company-Time, Incorporated-bases its maximum adoption benefit on the latest Smonth average of pregnancy costs in the area.

Are Benefits Taxable?

Currently, adoption benefits in the form of cash assistance are federally taxable. However, there are ways for companies to provide employees with non-taxable benefits related to adoption. Medical and legal expenses may be covered under companyffponsored group plans, which are currently non-taxable.

Adoption Leave
How Prevalent Is It?

An informal poll of companies shows that many provide adoption leave on an individual basis, at the supervisor's discretion. Often, adopting employees can use personal leave time when the child joins the family or they may use vacation time even though no formal adoption leave exists.

Organized labor has a great interest in parental leave because of the large number of women in the work force. Unions frequently bargain strenuously for leave benefits and are now negotiating for contracts that provide both birth and adoption language.

Public sector union contracts are more likely to include longer leave provisions. Based on a review of 85 of 4,000 American Federation of State, County, and Municipal Employees' contracts, 88 percent of union employees may take more than 18 weeks of unpaid parental leave. Eighty-four percent of these employees are given leave for up to or more than 6 months.

Other unions have been less successful. The International Ladies Gannent Workers has fewer than 50 contracts with a parental leave policy that includes adoption. Carriers in the airline industry, for the most part, do not specify adoption benefits plans in their contracts.

With the passage of the Family and Medical Leave Act in 1992, employers with 50 or more employees, including the Federal Government and the Congress, must offer both male and female employees up to 12 weeks of unpaid leave upon the birth or adoption of a child. The employee is guaranteed his present job or one considered equivalent and the employer is required to continue health benefits during the leave period.

Policies on maternity leave vary from State to State. Minnesota was the first State to require employers to offer parental leave to both the mother and father of a newborn or adopted child. In Minnesota, all companies with 21 employees or more must offer up to 6 weeks of unpaid leave to both mother and father, who can take the leave at the same time and return to their original jobs or ones with comparable duties and salaries.

Other States that require employers to offer parental leave to adoptive parents include: Connecticut, District of Columbia, Maine, Massachusetts (female employees only), New Jersey, Oregon, Rhode Island, Washington, and Wisconsin. In addition to these States, Colorado and New York, while not mandating employers to provide parental leave, do require them to offer leave to adoptive parents if they offer it to biological parents. Kentucky parental leave law specifically applies only to adoptive parents.

Types of Adoption Leave
Most companies will allow an employee to take unpaid leave. While companies may offer their employees either paid and/or unpaid leave, the leave may be listed under a heading other than adoption. Paid leave may be defined as: authorized time off, discretionary time, annual or paid personal leave, annual or all-purpose time. The length of paid leave usually depends on the amount of leave time the employee has accrued. In some cases, a maximum duration of paid leave is set by the company.

Unpaid adoption leave may be considered personal leave, child care leave, personal hardship leave, or medical leave. Most companies offer limits ranging from 2 weeks to 1 year, with the median at 6 months. Some companies, however, set no time limits, but prefer to be open or negotiable, depending on individual circumstances.

Typical Company Plans
Given the differences in the size and economics of companies, there is no single adoption benefit plan that fits all companies. The following are examples of typical plans that are presently offered:

Wendy's International, headquartered in Dublin, Ohio, covers eligible adoption expenses up to a maximum of S4,000 per adoption for employees who have completed 1 year of service and participate in the company's Group Insurance Program. For the adoption of a child with special needs, Wendy's will reimburse up to $6,000 per adoption. Financial assistance will cover specific adoption-related expenses, such as licensed adoption agency fees, legal costs, State-required "home study and charges for temporary foster care before placement. A paid leave of absence is available upon assuming custody of the child, with the amount of leave determined by the employee's length of service. Unpaid leave must be approved by the employee's supervisor and the human resources department.

American National Can Company of Chicago, Illinois, reimburses for 80 percent of eligible adoption expenses up to $2,000 per adoption. The reimbursement covers reasonable and customary public and private agency fees, reasonable and customary legal fees, court fees, reasonable and customary charges for necessary medical expenses not covered under any other available flexible benefits option, and temporary foster care charges when their payment is required immediately preceding the child's placement.

The Campbell Soup Company of Camden, New Jersey, offers salaried employees financial reimbursement of up to $2,000 for adoption-related expenses, payable when the adoption is finalized. In addition, the company may give some paid leave to adoptive parent employees based on their length of service. Additional unpaid leave is available for up to 60 days with the approval of the employee's supervisor. This plan is available to both male and female regular salaried employees.

General Mills, Inc. of Minneapolis, Minnesota, specifies that benefits will be given to regular, active, salaried non-union employees working 50 percent or more of the standard work week with at least 1 year of service. The company reimburses 80 percent, up to $1,500, for these expenses: legal fees, court and Government fees, agency and foreign adoption fees, birth mothers' pregnancy expenses, travel expenses, child's medical expenses, and temporazy foster care. Coverage includes adoption of stepchildren and private adoption (where legally permitted) in addition to licensed agency adoptions. The company allows for unpaid time off according to the company's parental leave policy.

INTEGRIS Health-OKC reimburses $2500.00 for adoption; They stand behind the FMLA and are a very strong supporter of adoption.

Tile Procter & Gamble Company of Cincinnati, Ohio, reimburses employees for up to $2,000 of eligible expenses at any time after the child is placed in the family's home and considers each child separately in the case of multiple adoptions, permitting a maximum of $6,000 payable to any one family within a 1-year period. Employees with at least 6 months of continuous regular employment may be reimbursed, up to the $1,000 maximum, for recognized adoption agency fees, placement fees, maternity fees for the birth mother, temporary foster care fees, and legal fees. The company specifically excludes the following adoption-related expense items from reimbursement: transportation expenses, professional counseling to the adopted child's biological parents, institutional expenses (e.g., orphanage or unwed mothers home), fees related to legal guardianship, fees related to adoption of adults, illegal adoption services or procedures, or contested legal actions.

Xerox Corporation of Stamford, Connecticut, acknowledges that because adoption costs vary depending on such factors as geographic location, the nature of the adoption agency, and income of the prospective parents (or parent), the intent of the program is to provide some level of assistance to employees who wish to adopt.~ Xerox reimburses regular full-time or part-time employees who adopt with up to $3,000 in expenses such as: public and private agency fees, legal and court fees, medical expenses (including physical examinations for adopting parents and maternity expenses for birth mothers), foreign adoption fees, and temporary foster care charges.

Adoption has become an accepted method of building a family. Employers sensitive to family issues recognize the importance of adoption benefits to those considering adoption. Many companies find that offering monetary and/or leave benefits has created good will within the company, has incurred minimal costs, and has engendered a positive public image.

The appendices that follow the Preferences" section of this factsheet provide the following information:

Appendix I: Companies Offering Adoption Benefits

Appendix II: Other Adoption Assistance Programs

Appendix III: Other Adoption Activities for Employees in the Workplace

Appendix I

Companies Offering Adoption Benefits

Abbott Laboratories
ACACIA Mutual Life Insurance Company
Aetna Life and Casualty
American Assn. of Retired Persons
American Express
American Can Company
Apple Computer
Bank of America
Banker~s Life Company
Barclay American Corporation
Baxter Travenol Laboratories, Inc.
BEST Products Co., Inc.
C.L. Bete Company
Campbell Soup Company
Capital Cities/ABC
City of Philadelphia
Champion International Corporation
Colgate Palmolive
Control Data Corporation
Covenant Insurance Company
DDB Needham Worldwide
Deseret Mutual Benefit Association
Digital Equipment Corporation
Dow Chemical Company
Eastman Kodak Company
Educational Testing Service
Eli Lilly and Company
Emery Worldwide Corporation
Emett and Chandler Illinois, Inc.
Far East Motors, Inc. (Nissan)
Federal Home Loan Mortgage Corporation (Freddie Mac)
Federal Reserve Bank of Kansas City
Felt Products Manufacturing co.
First Pennsylvania Bank
Foote, Cone & Belding Communications, Inc.
Ford Foundation
Gannett Company
G.D. Searle and Company
General Mills, Inc.
General Motors Corporation
Goldome Bank of Buffalo
Hallmark Cards, Inc.
Herman Miller, Inc.
Hewitt Associates
Hewlett-Packard offers $5,000
Hoechst Marion Roussel Inc. (formerly Marion Merrell Dow Inc.)
Holy Cross Shared Services, Inc.
Honeywell, Inc.
Howard County, Maryland
Humana, Inc.
Intermountain Health Care, Ink
Int'l Business Machines Corp.
Int'l Minerals & Chemical Corp.
JM Family Enterprises, Inc.
Johnson Wax
Johnson and Johnson
S.C. Johnson & Son, Inc.
K Mart
Leo Burnett co.
Lincoln National Corporation
(Marion Merrell Dow, Inc.) now called: Hoechst Marion Roussel Inc.
McKesson Corporation
Mennonite Mutual Aid Association
Meredith Corporation
Merrill Lynch
Microsoft Corp. covers up to $5000 for adoptions, plus 3 months maternity and 1 month paternity.
Miles Laboratories, Inc.
Motorola, Inc.
National Adoption Center
Omnistaff, Inc.
Owens-Coming Fiberglas
Pfizer, Inc.
Phelps Dodge
Pitney Bowes
Procter & Gamble Company
Rohm & Haas Company
Signode Industries, Inc.
SmithKline Beecham
Pharmaceutical Company
Smith Kline & French Laboratories
Stanley Works
Syntex Corporation
Temple, Barker & Sloane
Texas Instruments, Inc.
Time Wamer, Inc.
Travelers Companies
U.S. Surgical Corporation
Victor F. Weaver, Inc.
Volvo of North America
Walt Disney co.
Wang Laboratories
Washington Post Company
Wendy's International, Inc.
Western Savings of Arizona
Wheaton College
Wyatt Corporation Xerox Corporation
Yale University

Appendix II
Other Adoption Assistance Programs
In addition to employer-provided benefits, those who adopt children with special needs are entitled to reimbursement from other sources.

State Reimbursement
A reimbursement for non-recurring adoption expenses (agency fees, legal costs, and transportation) is available through each State for families who adopt children with specialchildren from minority cultures. Half of the expenses are paid through State funds, the other half through federal funds up to $2,000. The benefit differs by State depending on the cost of the adoption, State rules, and public awareness. For example, California will pay only $400 no matter what the cost of the adoption is, while Oregon has done an extensive advertising campaign to encourage the public to take advantage of its fund. The average amount of money given to an Oregon adoptive family through this program is $669.

Military Subsidies

Military families are entitled to a reimbursement of adoption costs up to $2,000 through the Defense Authorization Bill of 1991. The law provides payment for most adoption-related expenses for infant, international and special needs placements, although travel expenses are not included. There are bills presently in Congress that would provide the same benefit for all Federal Govemment employees, but as of April, 1992 they have not yet been approved.

Tax Benefits

At one time, there was a tax benefit for people adopting children with special needs. However, this tax break was repealed by the Tax Recovery Act of 1986. Over the years, various bills have been proposed that would allow a specific dollar amount as a deduction for different types of adoptions. None has yet passed. Contact the coordinator of legislative affairs at Adoptive Families of America for the current status of any legislation in this area.

Appendix III
Other Adoption Activities for Employees in the Workplace

Today's climate, which supports family values so strongly, provides an ideal setting in which to introduce the idea of adoption benefits to your employer and to encourage visible support and encouragement of adoption. If your company does not provide adoption benefits to employees and you are considering adopting a child, you may want to bring to your personnel manager information about other companies that provide adoption benefits and suggest that similar benefits be incorporated into the benefits package of your employer. Bringing this article to him or her would be a good way to start that process.

Sometimes an employer needs general education about adoption in order to make a decision about whether or not to offer adoption benefits. In that case, the National Adoption Information Clearinghouse can provide you with brochures, factsheets, and other literature that will help.

If your company already has a solid adoption benefits policy, or perhaps to increase its interest in having one, you may be able to convince your company to sponsor one or more adoption- related activities. The following are some ideas. Maybe you can come up with some additional ideas of your own.

? Try to Persuade your company to become an adoption advocate. Write or- help them develop an article on adoption for the company newsletter. Such an article might feature an employee who has adopted.

? Ask the editor of the company publication if he or she will agree to begin a waiting Child~ column featuring children in your State waiting for permanent families. The National Adoption Center in Philadelphia, Pennsylvania, can help by providing photographs and information on appropriate children.

? Get permission to design a special recruitment or adoption education program for your company, including posters, brochures, films, and speakers.

? Ask your employer if it would be possible to incorporate an adoption message on company products or services. Examples include slogans printed on shopping bags and packages, placemats to distribute in family restaurants, and inserts in bills or advertisements.

? See if you can distribute adoption information desk-to- desk or through an insert in pay envelopes.

? Persuade your employer to provide Sinkind" services such as printing, equipment, and supplies to a nonprofit adoption organization in your area. Find out if company employees can volunteer time during the work day to assist a fledgling adoption organization, such as an adoptive parent support group.

? Make a pitch before the company charitable contributions committee to make a monetary donation to an adoption agency for the purpose of purchasing radio or television air time to advertise the need for adoptive families.

? Ask the person in charge of facility management if space could be made available for adoption meetings, seminars, and training sessions in your company building.

? Get permission for an adoption display to be placed in the company lobby or cafeteria.

? Provide current information on adoption to personnel officers, to include information on adoption Procedures and resources. Help them to help other employees interested in adoption.

? Ask your company to "Adopt a Child" and work with you and a community adoption agency to find an adoptive family for a specific child or sibling group.

There are many ways for employers to help facilitate the adoption of children in need of permanent families. They might provide direct adoption benefits, or they might participate in one or more of the activities mentioned above. Employers or employees seeking more information about adoption benefits and adoption in the workplace activities should contact the the National Adoption Infonnation Clearinghouse at (301) 2314512. This article was written by Gloria Hochman and Wendy Prowler of the National Adoption Center in Philadelphia, Pennsylvania, for the National Adoption Information Clearinghouse, 1992. It was revised in 1994.

Printed with permission from Debra G. Smith, ACSW, Director,

This material may not be reproduced and distributed without permission, however, appropriate citation must be given to the National Adoption Information Clearinghouse.

National Adoption Information Clearinghouse
P.O. Box 1182
Washington, D.C. 20013-1182
(703) 352-3488 ? (888) 251-0075

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