Data show that state paid leave programs help to increase labor force participation among women, improve economic stability for families, strengthen businesses and grow state economies WASHINGTON, D.C. – February 5, 2024 – New analysis from the National...
What Does Real Paid Leave Look Like?
Paid family and medical leave has been in the news again on the heels of historic victories for comprehensive, universal paid leave laws in Minnesota and Maine. Given the overwhelming support for this issue across partisan and demographic lines, it’s no surprise that lawmakers across the country have a growing interest in paid leave. In 2023 alone, at least 30 bills were filed to create new state paid family and medical leave programs – about a 50 percent increase from 2022. These lawmakers followed the tried-and-true model of social insurance, in which benefits are paid by the state government and funded by small payroll tax contributions. But some have opted for ineffective and inequitable proposals that would achieve real paid leave in name only. As we look forward to 2024 – from political campaigns to legislative sessions, it’s critical to know the difference.
Everyone needs paid leave, but that need is especially urgent for the lowest-paid workers because they are simultaneously the least likely to have access to paid leave and the most likely to suffer serious economic harm from that lack of access. It’s no coincidence that these workers are disproportionately made up of women, people of color, people with disabilities and other marginalized groups. For any paid leave policy to be truly effective, it must be designed in a way that tackles the barriers these workers face. And thanks to years of studying state paid leave programs that have successfully unlocked paid leave for millions of workers, we know what that looks like. Policies must be:
- Comprehensive, covering all types of medical and caregiving needs and all shapes and sizes of families.
- Inclusive, by covering all types of workers at all sizes of businesses.
- Meaningful, by providing workers enough time to address their medical and caregiving needs, in an amount sufficient for low wage workers to weather the loss of their usual paycheck.
- Secure, by protecting workers from being penalized or losing job opportunities for taking leave.
- Sustainable, by being fully funded in a way that is reliable, low cost for workers and employers, and not harmful to other vital social safety net programs.
Lawmakers and advocates in Minnesota and Maine centered these principles in their legislation, and the results speak for themselves.
- The laws provide leave for a wide range of purposes: welcoming a new child, caring for a seriously ill family member, dealing with one’s own serious illness, addressing the consequences of sexual or domestic violence and dealing with certain needs arising from a family member’s military deployment.
- Both policies allow workers leave to care for more than just immediate family members, including grandparents, grandchildren, siblings and chosen family.
- Both laws cover nearly all employees, regardless of the size of their employer or whether they are part time, full time, hourly, temporary or seasonal (with a limited exception for certain seasonal hospitality workers in Minnesota).
- Both provide adequate lengths of leave (up to 12 weeks in Maine and 20 weeks in Minnesota) and use sliding scales to set benefit rates so that lower wage workers receive as close to their usual paycheck as possible.
- Leave is job protected for employees who have worked for their employer for a certain amount of time – 90 days in Minnesota, 120 days in Maine – meaning that workers will have the right to get their job back when they return and to keep any employer-sponsored health insurance while out on leave. Employers are also prohibited from interfering with workers’ rights under the law or retaliating against them for exercising those rights.
- The programs are funded by minimal payroll contributions from employers and employees, with rates adjusted annually based on the solvency of the fund. Small businesses pay a reduced premium in Minnesota and no premium in Maine, at no increased cost to their employees.
More detail on these principles can be found in our issue brief, What Real Paid Leave Is – and What It Isn’t.
Despite the well-established social insurance model for paid leave, some lawmakers continue to push policies that are “paid leave” in name only. These proposals are misguided at best and actively harmful at worst, and would do little to nothing to bring paid leave to the workers and families who need it most. Here are some examples of what meaningful paid leave is not:
- Tax credits for employers who provide paid leave. These tax credits are too little, too late to actually help small businesses afford to offer paid leave.
- Voluntary, private paid family leave insurance. As recently passed in New Hampshire, Virginia and Florida, this insurance would be completely optional for employers – much like existing temporary disability insurance (TDI). Also just like TDI, the lowest paid workers would be least likely to work for an employer that offers such a policy.
- Cuts to other social programs, such as unemployment insurance or Social Security. These policies are thinly designed attempts to undermine the range of benefits that help working families stay financially secure across their lifetimes.
- Parental or maternity leave only. Only about 20 percent of workers that take family and medical leave do so for parental leave. The rest, including people with disabilities, older workers and family caregivers, would be left in the lurch. In the case of North Carolina, which attached paid parental leave for state employees to a 12-week abortion ban law, some states may use paid parental leave to deflect attention away from their radical efforts to dismantle abortion freedoms. Although paid leave is a necessary part of the foundation for women and their families to thrive, it is not a substitute for legally protected access to abortion.
America’s working families deserve real, meaningful paid family and medical leave. Accept no substitutes.