Paid Leave Laws: Flash in the Pan or Wave of the Future?

Much has been made in recent years about the fact that paid leave laws in the United States suffer dramatically in comparison to every other industrialized nation. Many companies, large and small, have responded by adopting paid leave policies on their own. But beyond that, there is an increasing effort at the state and even city and county levels to require employers doing business within their borders to offer varying types of paid leave to their employees.

While most of the laws that have taken effect so far are in solidly “blue” states, employers all over the country need to be paying attention if they fall into any of the following categories:

  • They have employees in any of the cities, counties, or states that have enacted a paid leave requirement;
  • They are a federal contractor (which are subject to their own paid leave requirements under an Obama-era Executive Order) ; or
  • Their competitors offer paid family and medical leave policies that could make it harder for them to recruit and retain top talent.

Not only do these types of employers need to be paying attention, they need to be proactively working on a system for staying up-to-speed on and managing these increasingly convoluted and potentially overlapping requirements.

State and Local Laws

State, county, and city laws and ordinances that require employers to provide paid leave run the gamut from relatively simplistic (Arizona requires employers to provide a minimal amount of sick leave for the employee’s own illness) to very robust (Washington guarantees employees up to 90% of their wage or salary, with a maximum weekly benefit of $1,000).

Currently, Arizona, California, Connecticut, New Jersey, New York, Rhode Island, Washington, and the District of Columbia have enacted paid parental and/or sick/medical leave laws.  Some of the cities and counties with their own requirements include Tacoma, San Francisco, and Montgomery County, Maryland.

While there is a wide variance in what the different laws require, most of them apply to employers that have employees within the state, city, or county’s borders. So, for example, a company in Kansas with employees in San Francisco would have to satisfy its paid leave requirements for those employees. Some of the laws provide an outright exception or lessen the requirements for very small employers.

Federal Prospects

While legislation hasn’t yet been proposed to implement paid leave at a federal level, the Trump campaign and administration have expressed the desire to do so. In addition, the nonpartisan Kaiser Health News recently published an article called, “Paid Parental Leave May Be the Idea that Transcends Politics,” pointing out that both Democrats and Republicans in Congress have previously proposed legislation that would have created or encourage paid leave.

While it remains to be seen whether any issue can really “transcend politics,” we agree with the position reported in the article that paid leave is “a win-win for businesses and workers, and the economy as well,” due to its positive effect on worker retention and loyalty.

Bottom Line

Clearly it’s too soon to know where all this will go, but the winds of change seem to be blowing in favor of paid leave laws, at least for the near future. Employers need to keep a close eye on all the legislative developments and get ahead of the game by putting into place solutions for managing requirements that apply to them. For more on this issue, see “A Note about Leave Management Solutions.

 

by Julie Athey, Director of Compliance

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