Despite cost constraints, employers continue to invest in leave programs, WTW survey finds

Rhea-AI Summary

WTW (NASDAQ: WTW) reports that 73% of U.S. employers plan to enhance leave programs over the next two years, driven by improving the employee experience (67%) and boosting attraction and retention (60%). Employers are expanding parental, bereavement and caregiver leave; caregiver leave is expected to rise from 22% to 39%. Interest in unlimited PTO is increasing (now 15% of employers; 18% expect to offer it within two years). Administrative challenges persist: 49% cite program administration as the top obstacle. Outsourcing of State/Federal FML admin is currently 72% and expected to reach 82%; ADA outsourcing is projected to rise to 46%. Employers show ~70% openness to AI for routine case-management despite 66% uncertainty about current AI use.

Positive

• 73% of employers plan leave enhancements within two years
• Caregiver leave expected to increase from 22% to 39%
• 72% currently outsource State/Federal FML administration
• ~70% of employers open to using AI for routine case management

Negative

• 49% of employers cite program administration as the biggest obstacle
• 39% report integration of leave systems as a key challenge
• 38% concerned about managing workforce availability amid rising leave
• 66% uncertain about how AI is currently used in leave programs

News Market Reaction

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Data tracked by StockTitan Argus on the day of publication.

Enhancements to parental, bereavement and caregiver leave continue to rise

NEW YORK, Jan. 26, 2026 (GLOBE NEWSWIRE) -- Nearly three-quarters (73%) of U.S. employers plan to enhance their leave programs over the next two years, according to new research from WTW (NASDAQ: WTW), a leading global advisory, broking and solutions company. Employers cite improving the employee experience (67%) and strengthening attraction and retention (60%) as the top drivers behind these planned enhancements.

WTW’s 2025 Absence, Disability and Medical Leave Survey finds organizations are expanding multiple forms of time-away benefits to better meet workforce needs. Today, more than four in five employers offer parental leave, and 16% expect to enrich those programs. Similarly, 18% of employers plan to expand bereavement leave by increasing duration or broadening eligibility. The most significant growth is anticipated in caregiver leave, which is expected to nearly double—from 22% to 39%—over the next two years.

“Leave programs have become a strategic differentiator for employers competing for talent,” said Alex Henry, Group Benefits Leader, WTW. “Enhancing leave programs can be a cost-effective way to improve well-being, strengthen culture and meet the evolving expectations of a modern workforce.”

While investment in leave benefits is increasing, employers continue to face meaningful challenges. Nearly half (49%) report program administration as their biggest obstacle, followed by integration of leave systems (39%) and managing workforce availability amid rising leave incidence (38%).

Interest in unlimited paid time off (PTO) is also on the rise. Currently, 15% of employers offer unlimited PTO to exempt employees, up from 12% two years ago, and 18% expect to offer it within the next two years. Adoption is higher among directors and executives: 27% of employers offer unlimited PTO today, with nearly one-third (32%) planning to do so by 2028.

To address operational and compliance pressures, more employers are outsourcing leave administration. Today, 72% outsource State and Federal Family and Medical Leave administration, up from 64% in 2023, and 82% expect to outsource within two years. Outsourcing of Americans with Disabilities Act (ADA) functions is also increasing, rising from 27% two years ago to a projected 46% within two years.

Employers are simultaneously exploring the role of artificial intelligence in the leave experience. Although two-thirds (66%) remain uncertain about how AI is used today, nearly 70% express openness to using AI for routine case-management tasks—signaling opportunity for future innovation.

“Compliance requirements are growing more complex each year, particularly for employers managing multi-state workforces,” said Henry. “Organizations that modernize their programs and administration models are better positioned to meet employee expectations, manage risk and remain competitive.”

About the survey

A total of 585 employers participated in WTW’s 2025 Absence, Disability and Medical Leave Survey, conducted from late October to mid-November 2025. Survey respondents employ a combined 8 million employees.

About WTW

At WTW (NASDAQ: WTW), we provide data-driven, insight-led solutions in the areas of people, risk and capital. Leveraging the global view and local expertise of our colleagues serving 140 countries and markets, we help organizations sharpen their strategy, enhance organizational resilience, motivate their workforce and maximize performance.

Working shoulder to shoulder with our clients, we uncover opportunities for sustainable success—and provide perspective that moves you.

Media contacts

Ileana Feoli
ileana.feoli@wtwco.com

Stacy Bronstein
stacy.bronstein@meritcomms.com

FAQ

What did WTW report about U.S. employers enhancing leave programs in 2026 (WTW)?

WTW found 73% of U.S. employers plan to enhance leave programs over the next two years, citing employee experience and retention as top drivers.

How much is caregiver leave expected to grow according to WTW (WTW)?

Caregiver leave is expected to grow from 22% of employers today to 39% within two years.

What percent of employers currently outsource State and Federal FML administration (WTW)?

Today 72% outsource State and Federal FML administration, and 82% expect to outsource within two years.

How many employers offer or plan to offer unlimited PTO for exempt employees (WTW)?

Currently 15% offer unlimited PTO to exempt employees (up from 12%), and 18% expect to offer it within two years.

What operational challenges did WTW identify for leave programs (WTW)?

49% cited program administration as the biggest obstacle; 39% cited system integration; 38% cited workforce availability concerns.