Laura D’Andrea Tyson is a professor at the Haas School of Business at the University of California, Berkeley, and was chairwoman of the Council of Economic Advisers under President Bill Clinton.
Twenty years ago, just a few weeks after his inauguration, President Clinton fulfilled a campaign pledge and signed his first bill – the Family and Medical Leave Act. The law sent a strong signal of his commitment to provide more opportunities for American workers in return for more personal responsibility.
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The legislation covers workers in businesses with more than 50 employees who satisfy additional eligibility conditions, such as hours worked during the last year. About 60 percent of all workers are covered and eligible for leave under the act. Covered and eligible workers are allowed to take up to 12 weeks of unpaid, job-protected leave to recover from a medical condition or to provide care for sick family members or a new child.
The benefits of the Family and Medical Leave Act are real and significant. Although the provided leave is unpaid, it ensures job protection and the extension of health insurance when workers are temporarily unable to work for medical or family reasons. Moreover, a just-published Labor Department survey finds that most employees who take leave for family and medical reasons receive partial pay (17 percent) or full pay (48 percent ) for short leaves (fewer than 10 days), often drawing on paid leave days they have accrued during the previous year. However, workers in low-wage jobs are much less likely to receive even partial pay during a leave than workers in high-wage jobs.
Since its passage, the law has been used more than 100 million times to improve the lives of American workers. Meanwhile, dire predictions by critics that it would destroy jobs and harm business have proven wrong. Employers covered by the law report little or no difficulty complying with its provisions. Indeed, many businesses credit the law with reducing turnover and increasing worker morale.
The Labor Department survey also reveals how American workers choose to use their rights under the law. About 16 percent of covered and eligible workers under the Family and Medical Leave Act took leave last year, a share comparable to that in 2000. About 5 percent reported that they needed leave but were unable to take it, primarily because they could not afford to sacrifice their pay. This is about double the share in 2000 when real median wages and family incomes were higher. About 57 percent of all leaves are taken by workers because of their own medical conditions, with another 22 percent for pregnancy or birth of a child and 20 percent to care for a sick family member.
Most leaves are short – about 42 percent last fewer than 10 days and about 17 percent last more than 60 days. Almost all workers who take leave return to their employers. Less than 10 percent decide not to return to work. The Family and Medical Leave Act appears to strengthen, not weaken, worker attachment to the labor force, increasing employment and income stability over time.
Not surprisingly, because they bear children and still shoulder much of child- and elder-care responsibilities in families, women are a third more likely to take leave than men, and women with children are significantly more likely than men to report unmet leave needs. Over all, however, it appears that the Family and Medical Leave Act has had a small effect on parental-leave usage by mothers and no discernible effect on parental leave usage by fathers, indicating that there are financial limits on the extent to which families are willing and able to use unpaid leave for this purpose.
Women account for about 50 percent of all workers in the United States, which boasts one of the highest labor-force participation rates for women in the world – about 70 percent for women with children and about 60 percent for women with children under the age of 6 in 2011.
Most children now grow up in families without a full-time stay-at-home parental caregiver. More than 25 percent of American children live in single-parent households, the highest share in the developed countries, and about 75 percent of these households are headed by a woman. In the United States, single mothers work more hours and yet have higher poverty rates than single mothers in other high-income countries. The percentage of children living in poverty in the United States is considerably higher as a result.
Yet the United States is the only developed country that does not provide paid parental leave to women workers (or their spouses) to bear and care for children.
And businesses have not filled the policy void. Only about 25 percent of employers in the United States offer fully paid “maternity-related” leave and about 20 percent offer no such leave whether paid or unpaid. About 46 percent of workers have access to some paid parental leave, sometimes through a combination of earned sick days or vacation time, but access varies by wages and education.
Workers whose average wages are in the lowest 25 percent within their industry are about one-fourth as likely to have access to paid family leave than those whose wages are in the highest 25 percent. According to the Census Bureau, between 2006 and 2008 about two-thirds of new mothers with a bachelor’s degree or higher had access to paid parental leave, compared with only 18 percent of new mothers with a high school diploma or less.
Like other employee benefits, employer-sponsored parental leave programs heighten inequality among American workers and fail to address the daunting problems confronting low-income single mothers and their children. This population is the most vulnerable and least served by the current mix of family-support policies.
Contrary to concerns that paid parental leave is a disincentive to work, access to parental leave, paid or unpaid, increases the likelihood that a woman will return to work after the birth of a child. Among new mothers who work while pregnant and are able to take paid leave, almost 90 percent return to work within one year. And harsh necessity makes these “return to work” incentives stronger for less-educated and lower-income women.
According to research by the Organization for Economic Cooperation and Development and the World Economic Forum, paid parental leave programs, along with affordable child care, improve employment levels among women, increase the returns to their education and reduce gender inequalities in earnings and promotion opportunities. The results are faster and more equitable growth and a lower incidence of poverty among children.
The Family and Medical Leave Act has been a success. But its effectiveness at addressing the challenges confronting American workers is limited for two reasons. First, the law is not universal and many of those not covered and eligible are young adults in their childbearing years, are from minority backgrounds and are low-wage workers. Second, many eligible workers are not able to take leave because it is unpaid and they cannot afford to give up their wages.
It is time to consider extending the Family and Medical Leave Act to provide all workers with access to paid family and medical leaves that are job-protected and include some financial support. Researchers at the Center for American Progress have outlined a plan, called Social Security Cares, to achieve this goal. Social Security Cares is a family and medical leave insurance program that would cover all workers for the same life events covered by the Family and Medical Leave Act and offer partial wage replacement. The Social Security Administration would administer the program, which would be paid for with a small increase in the payroll tax. California has had a similar paid family-leave insurance plan for the last decade, and New Jersey and Washington have passed comparable legislation.
Back in 1993, when President Clinton signed the Family and Medical Leave Act after more than 10 years of debate and opposition, it was clear that American families were changing. Change has continued. We should open a new debate about how to modernize the Family and Medical Leave Act to address the needs of modern American families.
Article source: http://economix.blogs.nytimes.com/2013/02/08/the-family-and-medical-leave-act-20-years-later/?partner=rss&emc=rss