Volvo’s Latest Export Model Is 24 Weeks of Paid Paternity Leave

From next month Volvo Cars will roll out a Swedish version of paternity leave, or “pappaledighet,” across its 40,000-strong global workforce.

Starting April, all employees irrespective of gender or location will get at least 24 weeks parental leave that covers 80% of their base pay. It’s an initiative that aims to create a “culture that supports equal parenting,” according to Volvo Chief Executive Officer Hakan Samuelsson.

The automaker owned by China’s Zhejiang Geely Holding Group Co. said the move is inspired by the “tangible benefits” of parental rights in Sweden, where the government compensates parents with almost 80% of their pay checks (up to a cap) for 480 days per child.

“When parents are supported to balance the demands of work and family, it helps to close the gender gap and allows everyone to excel in their careers,” Samuelsson said in a statement.

The benefit comes after Volvo ran a pilot program in Europe that saw fathers make up 46% of the applicants.

But the challenge for both employers and lawmakers is that such programs often run up against deep-seated cultural views on parenting and work. That holds true even in equality-loving Sweden, where fathers took only 30% of the days allotted for parental leave last year.

To counter this, Volvo will present the leave as a pre-selected option for employees. It hopes that will create what it calls a “default effect,” as people are likely to stick with choices that are presented as standard.

Volvo Cars’ head of corporate functions, Hanna Fager, says the the policy will make it easier to attract talent and prepare the company for the seismic changes the car industry is going through.

The automaker aims to go fully electric by 2030 but currently only delivers one purely battery-powered model under its own brand name. In addition to developing a new lineup of electric cars, it needs to prepare its future models for an increasingly driverless future.

“We are trying to solve problems that no one has fully solved and the best way of doing that is by having highly innovative teams,” Fager said in an interview. “That power to innovate arises from diversity and inclusion.”

©2021 Bloomberg L.P.

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