Majority of Large Employers in Favor of Preemptive Federal Paid Leave Law, Survey Finds

February 21, 2020

Seventy percent of employers would favor a federal paid leave law if it preempts state and local laws, according to the "2020 Large Employers' Leave Strategy and Transformation Survey" from the Business Group on Health (BGH).

Not waiting for the states to act:  The BGH survey notes that large employers have been expanding paid leave benefits and increasing the number of reasons for which paid leave can be taken.  In the same study, employers said conflicting state leave laws are the greatest challenge to management.

FAMILY ties:  House Democrats have used their 13-months in charge to highlight the need for paid leave, holding hearings and introducing various bills.  The leading Democratic idea, the FAMILY Act (H.R. 1185), was first introduced nearly seven years ago and would create a federal insurance fund paid for by both employers and employees to provide 12 weeks of paid family and medical leave.  Sponsored by Rep. Rose DeLauro (D-CT), the FAMILY Act does not preempt state and local laws, nor does it provide a safe harbor for more generous employer leave programs.  A payroll tax split between employers and employees would fund the benefit, which would be run out of a new division of the Social Security Administration.

CBO response:  The Congressional Budget Office estimates the new payroll tax would raise a total of $361 billion over the 2020–2030 period, an insufficient amount to cover the cost of benefits to all eligible individuals.  CBO further estimates that just under 4 million people would claim benefits in 2022; the number would rise to more than 13 million people by 2030.

Strange bedfellows:  In the meantime, the Bipartisan Policy Center has weighed in on paid leave too.  In a letter to Congressional leadership signed by former Senators Chris Dodd (D-CT) and Rick Santorum (R-PA), the BPC said any national paid leave plan should consider U.S. economic changes, the effectiveness of wage replacement, ways to benefit men and women, and the influence of millennials in the workforce.