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Paid Leave Allies Mull Fallback Options as Cost Pressures Mount

Oct. 6, 2021, 8:51 AM

Supporters of House Democrats’ plan to create a nationwide paid family and medical leave program are girding for a battle over possible cuts to the proposal as pressure builds to trim the price tag of the party’s sprawling social spending and tax package.

Longtime proponents of paid leave say the Covid-19 pandemic laid bare the need for a robust, permanent program that’s available to as many workers as possible. But President Joe Biden said Monday that he expects the budget reconciliation legislation at the heart of his domestic agenda to come in between $1.9 trillion and $2.2 trillion, requiring Democrats to pare down a wish list projected to cost $3.5 trillion.

Amid the reset in negotiations this week, paid-leave advocates are calling for Democrats to maintain a comprehensive leave program, even though it could cost as much as $550 billion. At the same time, they’re privately strategizing around what would be the most effective—or least undesirable—way to narrow the House Ways and Means Committee’s proposal.

If it must be shaved down, cutting the duration of paid leave and delaying the schedule for benefits to kick in are emerging as leading options that several advocates said they could accept. They said they want Democrats, who can pass the legislation without Republican support, to avoid negotiating over who could access the leave, hoping to make it available to as many workers as possible.

“The folks who are saying the numbers need to come down aren’t actually coming back and saying what they are willing to give up,” said Laura Narefsky, counsel on education and workplace justice at the National Women’s Law Center. “Paid family and medical leave is so long overdue in this country, and now is the time to do it.”

It wasn’t immediately clear amid the haggling on Capitol Hill how much might have to be cut if paid leave winds up on the chopping block.

Biden and leading Democrats may be forced to decide between funding many programs at a lower level or cutting some altogether to salvage top priorities. The first approach is attractive because it could avoid alienating key Democrats, even if it may not make the most policy sense in the long run, a White House official with knowledge of the discussions said.

The official, who requested anonymity because they didn’t have authorization to speak publicly, called paid leave “an open question.”

Shorter Period?

House Democrats’ proposal calls for an entirely new entitlement program that would permit up to 12 weeks of paid leave for most workers. It would be available not only after the birth or adoption of a child, but also when workers or their family members face a severe illness.

“This is the one policy in that package that literally has the capacity to touch any household at any point,” said Vicki Shabo, a senior fellow for paid leave policy and strategy at New America’s Better Life Lab. “It’s not targeted just to families with children, it’s not targeted just to families with older people.”

Discussions among advocates were still preliminary and involved multiple fallback options, including limiting the number of weeks available to qualifying workers.

“I think there’s a number of dials you could turn, but starting with a smaller number of weeks is probably the way to maintain the equity that’s built into the package for women and for people of color and for low-wage workers,” Shabo said. She argued that Democrats should still fight for the full 12 weeks.

Vasu Reddy, senior policy counsel for economic justice at the National Partnership for Women & Families, said 12 weeks could be reduced, but doing so would disproportionately affect workers with the most significant care-giving responsibilities.

Timing of Benefits

House Democrats’ model calls for benefits to become available in July 2023, but that also could be changed to alter cost. Biden’s earlier proposal is cheaper than that of House Democrats, with a projected cost of $225 billion over a decade; it would gradually phase in benefits, hitting the maximum duration of 12 weeks in year 10.

Hannah Matthews, deputy executive director for policy at the Center for Law and Social Policy, acknowledged that a phased-in approach is a plausible option.

Maximum benefits wouldn’t need to start on day one, said Sherry Leiwant, co-founder of the advocacy group A Better Balance, but “it’s important that this is a permanent program.”

Who Qualifies

Ensuring the program is accessible for as many workers as possible is paramount for advocates, Leiwant said, and not just those who advocate on behalf of working parents.

She said advocates for people with disabilities and others are rallying behind the program, in hopes that it’s available “for all workers, past the child-bearing years.”

Emily Andrews, director of education, labor & worker justice at the Center for Law and Social Policy, said only around a quarter of workers who use paid leave offered by companies do so because they are new parents.

“It touches every part of the life cycle and every part of our lives,” she said. “We are advocating for a permanent paid leave program that is truly universal.”

Business Input

Moderate Democrats seeking to reduce the bill’s price tag will be armed with arguments from business groups about how to design the paid leave program.

Industry lobbyists focused on workplace policy planned to meet late Tuesday to discuss a range of potential tweaks to reduce costs, while making the proposal more tolerable for employers, said Roger King, senior labor and employment counsel at HR Policy Association.

King, whose organization represents Fortune 500 corporations, floated a few alternatives, such as a funding mechanism modeled after California’s leave law, in which employees and employers would share the cost. Another idea involves narrowing the qualification criteria so they adhere to the Family and Medical Leave Act, which provides workers with unpaid leave.

To contact the reporters on this story: Paige Smith in Washington at psmith@bloomberglaw.com; Ian Kullgren in Washington at ikullgren@bloombergindustry.com; Ben Penn in Washington at bpenn@bloomberglaw.com

To contact the editor responsible for this story: John Lauinger at jlauinger@bloomberglaw.com

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