Do you know what Paid Family and Medical Leave will do to your business?
Earlier this week I participated in a conference call with Chambers, business groups and employers from across the state regarding the Paid Family and Medical Leave Bills being considered on Beacon Hill. The call was hosted by Associated Industries of Massachusetts (AIM) and shed light on what is contained in the bills and how they would impact Massachusetts businesses.
The following information provided by AIM explains the bills.
The Senate paid leave bill creates a new Massachusetts law establishing the right for employees, certain state independent contractors providing family childcare, personal care attendants, and self-employed individuals to receive job protected paid family and paid medical leave under certain circumstances.
Benefits include up to 16 weeks of paid family leave, and 26 weeks of paid medical leave. Leaves may be taken intermittently.
Weekly benefits rate: 50% of the employee's weekly wage, capped at $1,000 per week. Benefits increase to 90% of weekly wage by January of 2021 and the average weekly wage is then tied to the Consumer Price Index for the Boston-Cambridge-Quincy consolidated metropolitan statistical area. Not only is this an extraordinarily high rate of compensation, but it also derives the wage rate from on the area of the Commonwealth with the most expensive cost of living.
Family leave is leave taken by an employee to provide care for a family member. Family member is defined as spouse, domestic partner, child, and parent, parent of a spouse or domestic partner, an individual who stood in loco parentis to the employee when the employee was a minor child, grandchild, grandparent, or a sibling of the employee.
Leave may be taken for any of the following reasons: to bond with the employee's child during the first 12 months after the child's birth or the first 12 months after the placement of the child for adoption or foster care with the employee. Leave may also be for a serious health condition of a family member; or because of a qualifying exigency pursuant to the Family and Medical Leave Act, 29 U.S.C. 2612(a)(1)(e), arising out of a family member of the employee being on active duty in the armed forces of the United States.
Medical leave is leave taken by an employee from employment due to a serious health condition of the employee that renders the employee unable to perform the functions of the employee's position.
The bill creates a new department to run the program as well as a new "assessment" to fund it - further; the assessment may be shared 50/50 between employers and employees.
AIM estimates the likely cost per week per employee to fund this new paid leave program exceed $10.00 per week, or $520 per employee yearly. The state's Unemployment Insurance system costs an average of $508 per employee yearly, raising over $1.3 billion to pay for benefits under the UI program.
For more detailed information you can access the Powerpoint presentation from the conference call here.
The Chamber will continue to monitor these bills and provide updates as needed.