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Affordable Policies

A Response to Can Working Families Ever Win?

Jodi Grant

8 The Family and Medical Leave Act (FMLA) was the first, and to date is the only, federal legislation to provide job protection for workers who face pressing family obligations. Prior to its enactment, Americans risked losing their jobs if they became seriously ill or chose to take time off to care for a newborn child or a loved one with a serious health condition. Since its passage, over 35 million American families have taken family and or medical leave.1

Some employers have realized that family-friendly benefits and working conditions are beneficial—not only for employees, but for the business bottom line as well. Often the resources saved in retention and health care costs are well worth the expense of providing paid leave and flexible hours. However, most employers still do not provide these benefits, leaving workers struggling to balance their work and family obligations.

The FMLA provides up to twelve weeks of unpaid, job-protected leave per year to covered and eligible employees. Employees can take this leave upon the birth or adoption of a child or the placement of a foster child. They are also eligible for family and medical leave to recover from their own serious health conditions or to take care of a sick child, spouse, or parent. In order to be eligible for FMLA leave, however, an employee must have worked for an employer for the past twelve months, and for at least 1,250 hours. In addition, the business must employ at least fifty employees within a seventy-five-mile radius of the employee's worksite.

Even if eligible, millions of workers are still forced to choose between a paycheck and caring for a loved one. Thirty-four percent of the men and women who take FMLA leave take it without any pay and 78 percent of eligible employees who needed but did not take family or medical leave did not take it because they could not afford it.2 One quarter of all sustained family struggles with poverty in the United States begin with the birth of a child.3 And, nearly one in ten leave-takers who receive less than full pay while on leave is forced onto public assistance.4 Therefore, paid leave must be made available to more American workers.

Low-income workers are disproportionately hurt. They are the least likely to have any paid leave and the most likely to lack savings. Seventy-six percent of those in the lowest income quartile lack sick leave and 58 percent lack vacation leave.5 For those workers who have sick leave, few can use it to care for family members. In addition, only 31 percent of women have paid maternity leave, and these tend to be highly-educated professionals. Sixty-three percent of women with a bachelor's degree or higher used paid benefits for maternity leave, compared with 18 percent of women who did not have a high school diploma.6

Jody Heymann highlights the public and private benefits of taking family and medical leave. Patients who are cared for by family members have faster recoveries, providing significant savings on health care costs. Many child-care facilities won't even consider admitting an infant before he or she is ten or twelve weeks old because the newborn's immune system is not yet mature, making the infant highly susceptible to infection. Time with parents is critical to a child's development and allows a baby to learn to trust and bond with his mother and/or father. For these reasons, almost every other industrialized nation provides paid parental leave. The average length of paid leave in European countries is ten months.7 And in some developing countries, such as Afghanistan prior to Taliban rule, working mothers received ninety days of paid maternity leave.8

Opposition

Members of the business community, most notably the Chamber of Commerce and the National Federation of Independent Businesses, vigorously opposed the original Family and Medical Leave Act. They argued that a government mandate would wreak havoc on business productivity and profitability. Studies have proven them wrong. A 2000 Labor Department survey found that 90 percent of businesses reported either no additional costs or showed actual savings as a result of family and medical leave policies and 84 percent of businesses covered by the FMLA found that it either increased or had no impact on productivity.9

Yet, the same criticism of the original Family and Medical Leave Act is being used to argue against paid leave, with businesses claiming that it will have a disastrous effect on productivity and profitability. In reality, the cost of providing paid leave is relatively low and the benefits are high. Businesses benefit from decreased health care costs and increased retention. In fact, 94 percent of fully paid leave-takers return to the same employer after taking leave.10 A recent Census Bureau Report confirmed that paid leave has a stronger retention effect than unpaid leave.11 Studies have confirmed that the costs of hiring a new employee, (such as advertising, interviewing, and training) are far greater than the cost of providing short-term leave to retain existing employees. This holds true for low-income employees as well as highly-paid and skilled professionals.12

In addition to business benefits, there are important impacts on public health. Sick children recover faster if their parents care for them. Infants that stay at home for the first few weeks are less likely to contract dangerous infections. If sick children and parents stay at home they are less likely to pass their illness onto others. Heymann's research demonstrates that the public benefit goes even further, as she uncovers a direct correlation between a parent's access to paid leave and a child's academic performance.

For these reasons, state and federal policy makers have sought to create programs to provide paid leave. The most expansive proposals provide a financial safety net for women and men on family or medical leave. Others provide income replacement for new parents. A third approach allows employees to use their accrued sick leave to take care of family members.

These proposals are not expensive. Some of the legislative proposals are funded entirely by state surpluses or state-budgeted childcare funds. Others require employer and/or employee contributions. For example, a Vermont proposal for paid parental leave was estimated to cost fifteen cents per worker per week, and a Washington state proposal for paid family leave was estimated to cost two cents per employee for each hour worked.

Affordable approaches

State legislators are leading the way on innovative proposals to provide paid family leave. In 2001, family leave benefit bills were introduced in twenty-six states, and nineteen state legislatures held hearings on providing paid family leave. Governor Howard Dean (D–VT) and Governor Jane Swift (R–MA) also introduced plans to provide paid parental leave.

Oklahoma enacted legislation that allows state employees to use their accrued sick leave to take care of sick family members. Employees are also permitted to donate unused accrued leave to a co-worker in need. This allows employees to receive paid family and medical leave as well as paid leave to take care of a child, spouse, or parent who is not seriously ill but needs to see a doctor or is home sick. This program has no impact on the state budget and may be an attractive way for policy makers to assist working families during an economic downturn.

Some states, like California, have gone further, requiring all employers that provide sick leave to allow employees to use it to care for a sick child, spouse, or parent. Montana recently created a program modeled after Minnesota's At Home Infant Care Program. Both programs, geared towards low-income parents, allow eligible parents to receive designated child-care funds to stay at home for the first year of a child's life. There is no additional financial burden placed on state budgets because these programs rely on funds that have already been budgeted.

Five states—California, Hawaii, New Jersey, New York, and Rhode Island, as well Puerto Rico—have provided paid leave for some types of family and medical leave for over forty years through their Temporary Disability Insurance programs. These programs provide coverage to employees suffering from non-job-related injuries or illnesses as well as maternity-related disability. Employers and/or employees pay for the program. In some states the program is run by a state agency. In others, employers contract privately to provide the benefits. Benefits range from a minimum of $170 a week in New York to $492 a week in California. Approximately 65 percent of the people in these states who need family and medical leave are entitled to paid leave because of these temporary disability laws. New York, New Jersey, California, and Hawaii have all introduced legislative proposals to expand their disability leave to cover other types of family and medical leave.

Other states have proposed the creation of family leave funds, the use of state surplus dollars, or the expansion of unemployment insurance programs to provide paid parental leave.

Federal proposals

Federal legislators have recognized these promising state proposals and have introduced legislation to authorize 400 million dollars in direct grants to states to provide funding for paid family-leave pilot programs. These proposals have been included in the top bills introduced by the Democratic leadership in both the House and the Senate. Federal legislators are considering a bill that would require employers to provide a minimum amount of paid leave for all employees that could be used for their own illnesses, to take care of sick loved ones, for medical visits, school visits, continuing education, and so on.

All of these promising new initiatives continue to gain momentum despite the current economic downturn. It is instructive to note that the Family and Medical Leave Act was passed shortly after unemployment hit a high of 7.5 percent in 1992.13 In times of recession, the public is more concerned than ever about job protection, and the strain to balance family and work becomes even more pronounced.

Changing demographics

Public support for paid leave is overwhelming. A recent national poll found that 89 percent of parents of young children and 84 percent of all adults support paid parental leave.14 And this need will only continue to grow. In 1997, one in four Americans had an elderly relative to care for and many reduced their work hours or took at least a brief leave to care for that person.15 Nearly two thirds of American women and men under the age of sixty believe they will have to care for an older relative in the next decade.16

Since the 1970s, more and more women have entered the workforce and the need for paid leave for both men and women has become an increasingly important family issue. In 1998, 51 percent of married couples with children both worked, up from 33 percent in 1976. In 1998, 59 percent of women with babies younger than age one were employed, up from 31 percent in 1976.17

As with the original Family and Medical Leave Act, it will take time to pass legislation that makes paid leave a reality for more American families. The strong support for family leave benefits continues to grow and more and more policy makers are determined to find ways to provide their constituents with a safety net. It is only a matter of time before American workers, like those in most of the world, will be entitled to some income for family or medical leave.<


Jodi Grant
is director of Work and Family Programs and Public Policy for the National Partnership for Women & Families.

Return to the forum on Caregiving, with Jody Heymann and respondents.

Notes

1 Department of Labor, Balancing the Needs of Families and Employers: Family and Medical Leave Surveys, 2000 Update, a survey conducted by Westat (Washington, D.C., 2000). Available at: http://www.dol.gov/ dol/asp/public/fmla/main.htm

2 Department of Labor, Balancing the Needs of Families and Employers.

3 Jane Waldfogel, "International Policies Toward Parental Leave and Child Care," The Future of Children 11 (spring/summer 2001).

4 Department of Labor, Balancing the Needs of Families and Employers.

5 Heymann, The Widening Gap.

6 Bureau of the Census, Maternity Leave and Employment Patterns: 1961–1995, a study by Kristin Smith, Barbara Downs, and Martin O'Connell (Washington, D.C., 2001).

7 Waldfogel, "International Policies Toward Parental Leave."

8 International Labour Organization, Conditions of Work Digest, on Maternity and Work, (Geneva: ILO, 1994). Available at: www.ilo.org

9 Ibid.

10 Congressional Commission on Family and Medical Leave, A Workable Balance: Report to Congress on Family and Medical Leave Policies, (Washington, D.C., 1996).

11 Bureau of the Census, Maternity Leave and Employment Patterns.

12 Congressional Commission on Family and Medical Leave, A Workable Balance.

13 Bureau of Labor Statistics, "Unemployment Rate-Civilian Labor Force," Labor Force Statistics from the Current Population Survey, Series ID: LFU21000000. Available at: www.bls.gov

14 Zero to Three: The National Center for Infants, Toddlers and Families, Civitas, and the Brio Corporation, What Grown-Ups Understand About Child Development: A National Benchmark Survey, conducted by DYG, Inc., October 2000.

15 National Family Caregivers Association, NFCA Caregiver Survey, July 2000. Available at: www.nfcacares.org

16 National Partnership for Women & Families, Family Matters, a survey conducted by Lake, Sosin, Snell, Perry & Associates, Inc., 1998.

17 Bureau of the Census, Maternity Leave and Employment Patterns.


Originally published in the February/March 2002 issue of Boston Review



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