Companies Are Cutting Paid Time Off and Parental Leave, and Experts Say Other Companies Could Follow

Some of the most valued workplace benefits are quietly getting smaller. Paid parental leave and paid time off, long considered pillars of competitive employment packages, are being trimmed at major companies, and labor experts warn this may be the beginning of a broader trend rather than an isolated one.

Zoom reduced its paid parental leave this year, with birthing parents now receiving 18 weeks instead of the previous 22 to 24, and non-birthing parents dropping from 16 weeks to 10. Deloitte, meanwhile, is planning cuts to parental leave, annual PTO, pension plan contributions, and IVF funding for employees in internal support roles, including administrative services, IT, and finance, with changes set to take effect January 1, 2027.

These moves are happening against a backdrop of a cooling job market. The US quit rate fell to 1.9% in February, according to the Bureau of Labor Statistics, a sign that workers are staying put rather than seeking alternatives. That mobility shift, experts say, is giving companies more room to act.

When One Big Name Moves, Others Take Notice

Laszlo Bock, who previously served as Google’s head of human resources and now advises startup founders, told Business Insider that when high-profile employers make a move like this, it signals permission to the rest of the market. He pointed to the adoption and rollback of DEI policies and the push for return-to-office as recent examples of how quickly corporate behavior can follow a lead.

Bobbi Thomason, a professor of applied behavioral science at Pepperdine Graziadio Business School, acknowledged that Zoom and Deloitte may currently be outliers, but noted they could become the precedent others quietly reference. The concern isn’t just that these two companies are cutting, it’s that the cuts come as broader workplace shifts are already underway, from stricter performance expectations to widespread office return mandates.

Josh Bersin, a human resources analyst, told Business Insider that if companies believe trimming benefits improves their bottom line, they will. He noted that in the current environment, benefit reductions are seen internally as preferable to layoffs, which carry greater reputational and operational costs. Whether workers agree with that framing is a separate matter.

Workers Have Less Room to Push Back Right Now

A 2026 MetLife survey of 2,550 full-time US workers found that more than three-quarters consider paid leave a must-have benefit, not a perk. That makes the current moment particularly complicated: the benefits being cut are among the most valued, while the conditions for pushing back are among the weakest in recent memory.

Joshua Lavine, CEO of Capitol Benefits, an insurance advisory firm, told Business Insider that workers simply don’t have the leverage they did a few years ago. With job growth stagnant and fewer opportunities to switch employers, the pressure that once pushed companies to protect competitive benefits has eased considerably. Ravin Jesuthasan, global leader of Mercer’s transformation services, told Business Insider that underutilized benefits and perks tend to top the list when companies look to cut costs.

Peter Cappelli, professor of management and director of the Center for Human Resources at the Wharton Business School, observed that the current tightening doesn’t appear to be driven by companies in financial distress. Rather, with the job market less competitive for workers, companies feel they can make these moves without significant backlash, at least in the short term.

The Risks Companies Are Taking On

Christopher Myers, director of the Center for Innovative Leadership at the Johns Hopkins Carey Business School, cautioned that cutting benefits can backfire in ways that don’t show up immediately. Workers who feel undervalued may not quit, but they may quietly disengage, which carries its own cost. A 2025 Gallup study found that global employee engagement dropped for a second consecutive year, reaching its lowest point since 2020.

Myers also noted that if labor market conditions shift back in workers’ favor, companies that cut core benefits now could find themselves at a disadvantage in attracting top talent. Benefits, he told Business Insider, become a deciding factor for people weighing one employer against another. A reputation for reducing them isn’t easy to reverse.

For workers with caregiving responsibilities, Bobbi Thomason of Pepperdine Graziadio Business School noted, reductions in paid time off carry a particular weight. At Deloitte, one employee group is seeing parental leave cut from 16 weeks to eight, and a $50,000 adoption and surrogacy reimbursement that covers IVF treatment has been eliminated entirely. For the people in that group, the changes are real and immediate, taking effect in January.