Employers see Likelihood of a National Paid Family Leave Law Grow

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Employers in many states may look at paid family leave as a distant and remote possibility. However, HR professionals across the country are already managing the realities of state-mandated paid family leave laws, while still others are preparing for the regulatory changes stemming from recently-passed state leave laws that have yet to go into effect.

The Family Medical Leave Act of 1993 – the landmark federal regulation that mandates large organizations offer up to 12 weeks unpaid leave – is the last major initiative that dealt directly with employee leave at the federal level.

And now, there is momentum building for a national paid family leave policy. Five states already have paid family leave laws on the books: California and Rhode Island fund theirs through an employee payroll tax, while New Jersey, New York, and Washington have laws funded through an employee and employer payroll tax. These laws mandate anywhere from four to 12 weeks of paid leave, and replace between 50 and 90 percent of wages.

In addition, Massachusetts has a paid family leave law that will go into effect in October of 2019, while employers in Connecticut will need to comply with that state’s recently-passed law in 2021.

One issue is the compliance burden of multi-state employers, many of which must adjust their leave offerings based on the various states in which their employees are located. In order to avoid employee relations issues – where employees in a state with a generous paid family leave mandate receive more benefits than employees working for that same company, but located in a state with no paid family leave mandate – many multi-state employers simply elect to offer the most generous national policy to ensure compliance and maintain employee morale.

HR Professionals see this growing trend among states to enact their own paid family leave laws as indicative of what’s coming at the national level. While action is unlikely with the current divided Congress – with different parties controlling the House and Senate – Ivanka Trump has drawn attention to a potential national paid family leave law. The White House has released a proposal that would establish a federal state-parental-leave benefit providing six weeks of benefits for mothers, fathers, and adoptive parents, funded within the unemployment insurance program.

Generally, the public broadly supports the idea of a national paid family leave law. However, support for the varying generosity of such proposals – and the associated cost in increased regulatory burden and higher taxes – will contribute to this becoming a hotly debated and contentious issue as we enter a presidential election year.

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