Debate Continues Over Proposed Federal Paid Leave Mandate

Date: September 29, 2015

Group Of US Business School Professors Among Latest To Urge Federal Paid Leave

A letter sent to Congress earlier this month and signed by 203 faculty members from US business schools urges legislators to pass a measure mandating paid family and medical leave. The group argued that “sound business practices, data from other countries, our own research with employers, employees and organizations, and our experiences teaching the business leaders of tomorrow compel our conclusion that the United States must adopt a national paid family and medical leave policy.” The Los Angeles Times noted that the faculty members were supporting the Democratic-proposed Family and Medical Insurance Leave Act, also supported by President Obama. That measure would implement “an independent trust fund as part of the Social Security Administration that would be funded by employee and employer payroll tax deductions (0.2% of wages each) and be available to all workers.” Companies would have an option “to add supplemental paid leave” above the requirement. Among those helping to draft the letter to Congress with aid from the National Partnership for Women and Families was University of Pennsylvania Wharton School professor Stewart Friedman, who said, “We’re really trying to frame this as an opportunity for our national social policy to catch up with the rest of the world. We are lagging so far behind and everybody knows this.”

Despite the latest move from business faculty to support paid leave, the Pittsburgh Post-Gazette noted that the issue remains controversial within the business community. For example, the US Chamber of Commerce “has opposed federal legislation proposing paid leave for workers,” while the US Women’s Chamber of Commerce “strongly supports it.” Women’s Chamber CEO Margot Dorfman suggested the difference is that “the US Chamber is largely made up of large corporations, while USWCC’s 500,000 members represent businesses that are small in addition to being run by women.” Meanwhile, Pennsylvania Chamber of Business and Industry director of government affairs Alex Halper said the chamber is concerned about “one-size-fits-no-one” federal paid leave policies when “companies could do a better job designing one themselves.”

What This Means For Small Businesses

Though US small business owners want their workers to be able to take time off for illness or emergencies, mandates like the proposed FAMILY Act hurt everyone by limiting employer flexibility to make case-by-case judgments on staffing. Forcing one-size-fits-all mandates would cost small businesses, ultimately forcing cuts in staffing.

Additional Reading

NFIB previously noted passage of paid leave legislation in different states this year.

Note: this article is intended to keep small business owners up on the latest news. It does not necessarily represent the policy stances of NFIB.

Related Content: Small Business News | Paid Leave

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