Costly Paid FMLA Proposal Approved, Expanded

Issues & Policies

The Labor Committee went beyond simply approving its proposal for a paid FMLA system in Connecticut. Before it left committee, they amended the bill and made it an even more burdensome one-size-fits-all mandate.

HB 6932 was approved by the committee on a party-line vote (Democrats supporting and Republicans opposing, with one absent), but not before the paid FMLA proposal was transformed from an opt-in program to a program where participation was mandatory for every employee in companies with two or more employees.

In exchange for having a to-be-determined percentage deducted from their paychecks, employees would be entitled to up to 12 weeks of paid leave every calendar year, at 100% of their pay. 

Sound expensive? That’s not the half of it. 

First, it will be astronomically expensive for employees. The bill allows the Labor Department to arbitrarily increase the employee deduction to ensure the program’s solvency. Even employees that never use the leave will be paying every week to support those that do for a potential of three months each year.

Second, it’s costly to job creators. Failing to provide absent employees with nonwage benefits would be considered a discriminatory practice.

Add the mandatory costs of unemployment compensation and workers’ compensation coverage for employees not even in the workplace, and employers will be facing significant expenses for absent employees .

Finally, it's bad for taxpayers. In many ways, paid FMLA will be similar in size and scope to the unemployment compensation system, which takes hundreds of state Labor Department employees to run.

Why? Because given the state’s unemployment system is partially funded by federal dollars, those employers are prohibited by law from administering any other programs. Bottom line is that hundreds more state employees likely will be needed, along with a new IT infrastructure, and probably new office space. 

In Washington State, where they looked at this same proposal a few years ago, it was estimated that the extra bureaucracy would cost $1.2 billion per biennium. 

So why a paid FMLA program? Advocates say it’s a women's issue, and that the U.S. is the only industrialized country that doesn't have paid parental leave.  

What they leave out is that, according to a study by the Pew Center, many of those counties with generous leave policies have much larger gender wage gaps.

And in written testimony by Carrie Lukas, Managing Director of the Independent Women's Forum, “European countries offer women extensive paid leave time, but European women appear to pay a price in terms of workplace opportunities. For example, they are far less likely than their American counterparts to be in managerial positions.” 

Lukas went on to cite examples of how European women are nearly three times less likely to be managers in Europe, whereas in America, they are equally as likely as men. 

Above all, this expensive mandate is too much for Connecticut businesses to take on in an already costly state. It’s time to stop adding more one-size-fits-all mandates and allow employers and employees to work out organically developed, affordable, and customized leave policies.     

For more information, contact CBIA’s Eric Gjede at 860.244.1931 | | @egjede


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