The looming debate over a national paid leave mandate began to take shape Tuesday in a U.S. Senate committee hearing where Republicans raised concerns about paying for it while Democrats predicted it would boost the economy and women’s workforce participation.
Congress is set to consider creating that federally run paid family and medical leave program, as a part of the broader jobs, infrastructure, and family-support proposals pitched by President
Biden’s paid leave plan, like similar proposals pending in Congress, would let American workers take up to 12 weeks of paid leave for the birth or adoption of a child, the worker’s or a family member’s serious illness, and other reasons related to military service or domestic violence.
The White House estimates Biden’s plan would cost $225 billion over a decade—a price tag that’s held down by phasing in benefits so that the full 12 weeks only becomes available in year 10.
Tuesday’s hearing reaffirmed the challenge that Democrats face in winning enough GOP support to get a comprehensive paid leave mandate through the Senate, as Republican members of the Health, Education, Labor and Pensions committee took turns questioning the wisdom of tax increases to pay for the program and the potential impact on small businesses.
If they can’t garner sufficient bipartisan support, Democrats would have to try to pass a paid leave program through the Senate’s budget reconciliation rules with just 51 votes, a move that might limit their ability to include provisions such as job protections while workers take leave.
“It’s easy to come up with good ideas and tell someone else to pay for it,” said Sen.
Burr suggested Congress should pursue other options for encouraging businesses to provide paid leave and flexibility to their workers, such as tax credits and allowing employers to give workers the option between overtime pay and accumulating comp time.
Millions Left Workforce
Democrats countered that ensuring nationwide paid-leave access for all workers would strengthen the economy, in part by helping encourage a return to the workforce for the 2 million women who left it during the pandemic.
“Millions were infected. Millions more, especially women and workers of color, were forced out of their jobs in large part due to lacking paid leave or quality affordable child-care options” during the pandemic, said Sen.
Democrats aimed to make a business case for paid leave, building on a virtual meeting with Labor Secretary Marty Walsh on Monday. In that discussion, business executives and employees from
The U.S. business community has signaled a growing openness to a national paid leave policy, albeit one that depends on how the program is designed.
“The United States has been behind most of the world in supporting our workers,” Walsh said on the Monday call, noting the issue is personal to him as his family could have benefited from access to paid leave when he was diagnosed with cancer as a child. “Our families and our businesses are paying the cost for this inaction.”
Costs vs. Benefits
Making paid family and medical leave available nationwide would boost the economy and improve the country’s competitiveness against global peers, who already provide some form of national paid leave, Vicki Shabo, a senior fellow on paid leave policy at the New America think tank, said during the two-hour Senate hearing.
A uniform national standard also would benefit large, multistate employers that must navigate compliance with varying state laws, said Marianne McManus, a vice president of health and benefits at IBM who spoke on behalf of the American Benefits Council.
Nine states plus the District of Columbia have enacted their own paid family and medical leave programs covering most private-sector workers.
“Today’s policy model doesn’t allow for consistent and uniform benefits for all employees,” McManus said.
But Republican senators, including Sen.
It’s unclear whether Democrats will pursue a payroll tax for paid leave. Shabo and other paid leave advocates have said previously they expect Biden will advocate for paying for it through broader tax overhaul plans, since using a payroll tax could violate his campaign promise not to raise taxes on anyone making less than $400,000 per year.
The FAMILY Act, a national paid leave proposal by Rep.
Beyond the reluctance to raise taxes, a national paid leave program also faces opposition over its impact on small businesses.
Small businesses tend to offer flexible, ad hoc time off arrangements for their employees but can’t afford or handle the administrative burdens of the same kind of paid leave policies that companies such as IBM offer, said Beth Milito, senior executive counsel for the National Federation of Independent Business.
“There is no such thing as a one-size-fits-all policy that works for every business or every industry,” Milito told the Senate panel. “I understand the good intentions behind various proposals to mandate leave, but NFIB and its members have long opposed leave requirements for two reasons—inflexibility and cost.”