> And also there's a big ethical question here if you create an excemption for small business, because you create a two class workforce where parents in small companies lack what is arguably a very fundamental right.

The way I see this, the fundamental right here is to have paid parental leave in general, not a right to have it at any particular workplace specifically. Thus, so long as those who need it can get a job that offers it, I don't see any pragmatic reason to require all businesses to do so. So long as it's clear in advance - so people who e.g. don't plan on having children can go seek employment with small businesses. It's not an insignificant part of the population, so why remove an option for them?

Why make employers eat the costs? Just make government pay equal benefits to every mother for x months and don't force employers to keep the position open. This way actually everyone will have the same rights unlike now where how much you get depends on how good a job you managed to land even if you only worked there for a very short time.

There is incentive to re-hire anyway if you have open positions as you get someone already familiar with the work. Forcing employers to do so is a problem for smaller companies having many non-duplicated positions though.