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How Would a National Paid Leave Plan Impact Connecticut’s Program?

  • White House has proposed a national program for paid family and medical leave
  • The plan includes some similarities to Connecticut’s paid family and medical leave program, which is currently being funded through payroll deductions and goes into effect next year
  • Several questions have not yet been addressed regarding a national paid leave program, including whether it would supersede state programs

Summary by Dirk Langeveld

A national family and medical leave program being pitched by the Biden administration shares several benefits with a Connecticut program whose benefits will become available next year, and is similar to legislation that has been pushed by a Connecticut congresswoman for eight years. Several details of the White House proposal have not yet been released, and it is not yet known how it might affect Connecticut’s plan if it is approved.

President Joe Biden says the lack of a paid leave program in the United States has negatively impacted the nation’s competitiveness, often forcing people to leave the workforce or return to their job too quickly after an event such as childbirth. He said the COVID-19 pandemic has highlighted the need for a national paid leave policy in order for workers to maintain a career while having the ability to address family and medical needs.

The Family and Medical Leave Act of 1993 allows employees to take up to 12 weeks of leave; however, it is unpaid, does not apply to bereavement or family violence, and is only available to workers at companies with 50 or more employees. Several states have developed their own paid leave plans, with Connecticut currently in the process of building a fund for a program established in 2019.

The following is a comparison between the American Families Paid Leave Plan put forward by the White House and Connecticut’s family and medical leave program. Information was provided by Andrea Comer, chief external affairs officer at the Connecticut Paid Leave Authority (PFMLA).

Reasons for leave

The reasons allowed for taking paid leave are nearly identical in the Connecticut program and White House proposal. Permitted reasons include addressing one’s own health concerns, childbirth, expanding a family through adoption or foster care, military caregiver leave, qualifying exigency leave, or family violence leave.

The White House plan would allow workers to take three days of bereavement leave starting in the program’s first year. Connecticut’s paid leave program does not cover bereavement, instead deferring to employer policies.

Benefits and length

Both programs allow workers to take 12 weeks of paid leave. However, the White House plan declares that this length of leave will only be guaranteed by the 10th year of the program. Connecticut’s program allows 26 weeks for military caregiver leave, but only 12 are paid. It also provides 12 days for family violence leave and an additional two weeks for incapacity during a pregnancy.

Connecticut compensation covers 95 percent of an employee’s wages up to 40 times the minimum wage, then 60 percent of base weekly earnings with a cap set at 60 times the minimum wage. This will reach $900 a week when Connecticut’s minimum wage increases to $15 an hour on June 1, 2023.

Employees qualify for the Connecticut paid leave program if they are employed or previously employed with a company participating in the program, worked in state during the 12 weeks immediately preceding the leave request, and earned at least $2,325 in the highest earning quarter of the past five quarters

The White House proposal calls for up to $4,000 in compensation per month, covering a minimum of two-thirds of a worker’s weekly wages. This share would increase to 80 for the lowest wage workers.

This plan is nearly identical to the FAMILY Act, which was introduced in Congress by Rep. Rosa DeLauro of Connecticut and Senator Kirsten Gillibrand of New York. The national paid leave program outlined in this bill is “modeled on successful state programs” and would compensate workers with up to 66 percent of their wages for 12 weeks.

DeLauro has introduced the FAMILY Act every year since 2013. She and Gillibrand noted how the pandemic led to the creation of the Families First Coronavirus Response Act, which required some employers to provide workers with two weeks of sick leave at full pay for leave related to COVID-19 illness, along with up to 12 weeks of family and medical leave to care for family members at two-thirds pay. However, they say up to three-quarters of U.S. workers were excluded from these benefits.

Where funding comes from

Connecticut’s program is funded entirely through employee contributions. Employee contributions are capped at 0.5 percent of wages, with the salary contribution level capped at the Social Security contribution rate.

The White House has not yet released details on how the program will be funded, but estimates it will cost $225 billion over the course of a decade. The program could also be funded by payroll taxes, although Biden is seeking to fund his overall “families plan” by higher taxes on the wealthy, including nearly doubling the capital gains tax and raising the top marginal tax income rate.

Status of Connecticut’s program

Connecticut began collecting funds for its paid leave program through payroll deductions at the start of the year, and workers can begin drawing benefits from this fund starting on Jan. 1, 2022. Businesses with at least one employee are required to participate, although they may be exempted if they can show that they offer a private paid leave program with comparable benefits.

Governor Ned Lamont announced Monday that 108,911 businesses have registered with the PFMLA, contributing more than $102 million in the first quarter. This exceeded the agency’s goal of 104,000 businesses and original projections that $67 million would be raised in the first quarter.

Andrea Barton Reeves, CEO of PFMLA, says the agency will begin outreach to businesses with fewer than 10 employees. Many of these smaller companies have already registered for the program.

Comer said there are currently no changes planned for the state program as a result of the White House proposal, as there are several unanswered questions related to the national plan. These include how family will be defined, contribution details, what benefit levels will be for years zero through 10, whether a national plan will supersede state plans, whether any employers and employees are excluded, and what the status of FMLA will be if a national paid leave program is established.

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