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Paid FMLA Bills Get Hearing, But Few Believe It Will Pass

by | Mar 9, 2018 6:30am () Comments | Commenting has expired | Share
Posted to: Business, The Economy, Health Care, Jobs, Labor

Christine Stuart / ctnewsjunkie

HARTFORD, CT — For the fourth year in a row, women, men, and small business owners came to the Legislative Office Building to advocate for a Paid Family Medical Leave program to give families the ability to take paid leave for the birth of a child or a sick loved one.

Sen. Gary Winfield, D- New Haven, told the committee that having paid leave has meant everything to him. It allowed him to learn from his mother while she was on her deathbed and more recently it allowed him to spend time at the neonatal intensive care unit with his premature twins.

“My son wouldn’t eat unless I fed him,” Winfield said.

He said this legislation “is about getting to spend time with people in your life who are important.”

Scott Friedman, a small business owner from North Haven, said there’s no way he would be able to offer his employees paid leave, but if the state created a trust fund and allowed all employees to pay into it, then it would allow him to compete on benefits with much larger companies.

“This is an incredibly important investment in making Connecticut a great place to live,” Friedman said Thursday during a Labor and Public Employee Committee public hearing.

Despite the merits of the two bills, a Senate bill and a House bill, it’s unlikely the votes are there.

Gov. Dannel P. Malloy said Thursday that he advocated a “much broader application of paid sick leave,” and he’s not against Paid Family Medical Leave, but “my hunch is that the votes aren’t there for it right now.”

He said as more states move in that direction, Connecticut might be well positioned to take it up.

“What I do believe we can do immediately and meaningfully is further expand the ability of workers to earn time off when they’re sick,” Malloy said. “To be treated like most people like to be treated in life.”

Rep. Josh Elliott, D-Hamden, a proponent of Paid Family Medical Leave, agreed with the governor that the votes aren’t there.

“But the discussion can’t just be about what we can get through,” Elliott said. “We should be leading the discussion.”

It’s a discussion that doesn’t hurt the motivation of the Democratic base in an election year.

Legislative analysts estimated last year that 1,587,400 employees would be covered by the proposal.

Supporters of the bill say early research from states like California, New Jersey, and Rhode Island show the program is working and helping both families and employers.

A U.S. Department of Labor survey of the Rhode Island program, which was fully implemented in 2015, found “no evidence that the law had any significant effects” on worker productivity or other work-related activities.

In California, 10 years after the law took effect, a U.S. Department of Labor survey concluded that it “has not caused major problems for California employers. The vast majority (roughly 90 percent) report positive effects or no effects in terms of productivity, profitably, retention, and morale. Small employers, if anything, report fewer problems than large firms.”

A 2012 survey of the California law found that fewer than 10 percent of employers reported problems with productivity, absenteeism, turnover, profitability, career advancement, or morale; small employers were less likely to report problems than were large employers. California passed its law in 2004 and New Jersey passed a similar law in 2009.

A survey by the New Jersey Business and Industry Association in 2012 found that 62.5 percent of large businesses and 53.4 percent of small businesses had no problem adjusting to the program. The same survey found increased administrative costs and overtime pay for those businesses after the New Jersey law was implemented in 2009.

Proponents argue that in order to stay competitive Connecticut needs to adopt a paid Family and Medical Leave program. New York passed paid leave in 2016.

A recent poll commissioned by the U.S. Council of State Chambers of Commerce found that 72 percent of C-level executives and business owners support increasing parental leave, which would be covered under Connecticut’s legislation.

Like last year, proponents of the legislation are doubling down on their chances by introducing both a House and Senate version of the bill.

The Connecticut Business and Industry Association continues to oppose the legislation. During the public hearing on the bill, Eric Gjede, counsel for the CBIA, said 54 percent of its membership has added additional flexibility to their leave policies in the last five years to accommodate employees.

He said the proposal, which is funded by employee contributions, would be unsustainable from the start.

He said capping the mandatory contribution at 0.5 percent of salary ensures the program will be unsustainable, because it would mean an employee earning $52,000 a year would only contribute $260 a year to the program, yet would be able to collect $12,000 each year.

“The program does not work. It is not mathematically sound,” Gjede said.

He said you would need 47 people to pay into the fund for every 1 that’s paid out.

Sen. Beth Bye, D-West Hartford, said she doesn’t believe the ratio.

She said in her 40-year work career she’s only taken 80 days of leave to take care of family members. She said she would have contributed far more to the fund than she will have taken from it over that period of time.

Democratic gubernatorial candidate Ned Lamont said he comes out of the small business world and he understands how important paid family leave is to his employees.

“I would have lost some extraordinary people if I did not offer paid family leave,” Lamont said.

He said he would find the money needed by the Department of Labor to make the program work.

Last year, the Office of Fiscal Analysis estimated that implementing a paid Family and Medical Leave system will require the Department of Labor to hire additional staff to oversee compliance with the program.

The $13.6 million in costs won’t kick in until the second year of the budget when the state is required to start collecting employee contributions. Annually, starting in 2020, it will cost the state $18.6 million to operate the program, according to a fiscal note from the Office of Fiscal Analysis.

Those costs will be covered by contributions to the Family Medical Leave Trust Fund and won’t necessarily be paid by the state after the first year of the program. However, the legislation and the fiscal note aren’t clear where the startup costs would come from.

“The bill specifies the costs of administering the FMLC program are to be covered by the FMLC Trust Fund, which receives revenue from employee contributions as determined by the Labor Commissioner. However, no contributions to the FMLC Trust Fund are anticipated to be collected before July 1, 2019. Consequently, it is assumed the General Fund will cover the costs of the program until such time that FMLC Trust Fund revenues are sufficient,” the fiscal note states.

Carlos Moreno, a Working Families organizer, said the startup costs would be funded by bond allocations and reimbursed to the General Fund within the first year of collection.

“More importantly, the cost of doing nothing (when families lose their jobs or can’t pay their bills) is too high a cost for the state to bear,” Moreno said.

The Working Families Party points to a recent survey that found 38 percent of millennial workers stating they would move not just to another state, but another country in order to find better family and medical leave.

They say research shows small businesses actually support the proposal.

Massachusetts, New Hampshire, and Maine are also considering legislation this year.

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