Dive Brief:
- Democratic presidential candidate Kamala Harris has included in her platform a plan to provide up to six months of paid family and medical leave for workers nationwide. The plan would cover full wage replacement for workers earning less than $75,000 per year, with benefits decreasing for higher incomes.
- Kamala proposed to fund the program with payroll contributions; fines on corporations that fail to close their pay gaps; and tax increases on the top one percent and big corporations. Families earning less than $100,000 per year would be eligible for a refundable tax credit to offset any payroll contributions to the program.
- Six months of paid leave, her website asserted, would increase women's labor force participation by $900 billion annually, a 5% increase in GDP. The site also said "support" would be offered to small business to help with the costs of overtime pay, or replacement workers, to cover for workers out on leave.
Dive Insight:
The idea of paid family leave is highly appealing to U.S. workers — it's a favorite workplace benefit, according to a 2018 poll by Unum. Funding makes it a difficult concept to legislate, however. Lawmakers have floated various proposals.
The Workflex in the 21st Century Act, H.R. 4219, would amend the Employee Retirement Income Security Act (ERISA) and allow employers to opt out of compliance with certain existing laws in exchange for offering a minimum amount of paid leave for all employees.
The FAMILY Act, S. 337, would establish an Office of Paid Family and Medical Leave within the Social Security Administration. Up to 60 days' worth of benefits for qualifying employees would be funded by a payroll tax.
A few of the paid family leave proposals require workers to essentially fund their own leaves. The Economic Security for New Parents Act, S. 3345, introduced by Sen. Marco Rubio (R-FL), would allow new parents to borrow from their Social Security after the birth or adoption of a child. Similarly, the Cassidy-Sinema plan would give parents who qualify for the federal Child Tax Credit the option of taking an advance of up to $5,000 upon the birth or adoption of a child. Instead of the standard $2,000 tax credit, parents would receive an adjusted tax credit of $1,500 annually over 10 years.
It remains to be seen whether any of these proposals move forward. And while some employers previously resisted a national leave mandate, some have begun welcoming such legislation, seeing it as offering relief from the current patchwork of federal, state and local laws, which can be complex and difficult to administer.
