Could this be a game-changer when it comes to paid family and sick leave?

Yesterday, New York Governor Andrew Cuomo signed into law what is being dubbed the country’s longest and most comprehensive paid family leave program, which allows employees partially paid leave to care for a family member or a newborn child.

New York follows other states such as California, New Jersey and Rhode Island in providing paid leave in conjunction with unpaid leave entitlements under state and federal law.  All three states administer their programs through their respective disability insurance programs.

So then, what’s significant about New York’s law?  Similar programs in other states have fallen flat because those states have wrestled with how to fund these programs.  Take the State of Washington, for instance.  In 2007, Washington became the second state to pass a paid family leave law that would provide parents with $250 in weekly benefits for up to five weeks in the event of childbirth or adoption. However, the law has never taken shape because the state legislature has not funded it.

Unlike many of these other laws, New York’s version is funded not by the state or employers but by the employees themselves — through a ~$1 per employee weekly payroll deduction that will help fund a paid family leave program.

What’s the Entitlement?

Under the new law, after 26 weeks of employment, employees will be eligible for up to 12 weeks ofpartially paid family leave, which is defined as any leave:

  • to participate in providing care, including physical or psychological care, for a family member of the employee made necessary by a serious health condition (as defined by the FMLA) of the family member; or
  • 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; or
  • because of any qualifying exigency ( as defined under the FMLA) arising out of the fact that the spouse, domestic partner, child, or parent of the employee is on active duty (or has been notified of an impending call or order to active duty) in the U.S. Armed Forces.

Paid benefits will phase in over time.  Beginning in 2018, benefits will cover 50 percent of an employee’s average weekly wage with a cap at 50 percent of the statewide average weekly wage.  When fully implemented in 2021, the plan will cover 67 percent of an employee’s average weekly wage with a cap at 67 percent of the statewide average weekly wage.  The leave period also will sweeten from eight to 12 weeks over time.  At the outset in 2018, employees will be entitled to eight weeks of paid leave, increasing to 12 weeks of paid leave by January 1, 2021.

In touting the new law, Governor Cuomo’s office focused its attention on how women and families, in particular, will be aided under the new law:

Paid family leave also has the potential to serve as a great equalizer for women. In many instances, women who leave the workforce to care for a newborn not only forfeit their existing salaries in the short-term, but also suffer diminished future earnings and career trajectories in the long term. Establishing paid family leave marks a pivotal next step in the pursuit of equality and dignity in both the workplace and the home.

Will Other States Follow New York’s Lead?

Multitudes of paid leave legislation have sprouted at the state level across the country. Many of these bills have languished because of strong opposition from the employer community — and rightly so, since these laws generally mandate employers of all sizes to provide paid sick or family leave to their employers.  All without the state’s help.

New York’s new law seems to undercut this argument, since the employees themselves will be funding what is essentially an insurance-style scheme to cover time away from work for family obligations.  Thus, is it natural to assume that resistance to these kinds of laws will diminish over time? Not so fast. They still face opposition from the business community, which argues that employers will end up with higher expenses in overtime and training for employees who will cover for their co-workers on leave. Businesses also are rightly concerned about how much control they’ll have over employees taking leave under these state administered programs.

So, are we back to political gridlock then?