Why Paid Family Leave’s Demise This Time Could Fuel It Later

Senator Deb Fischer, Republican of Nebraska, championed and secured more modest legislation — tucked into the Republican tax cuts of 2017 — that gave small businesses a tax credit to fund family leave. She argued against broader versions, since many companies already offer employees paid leave.

“If you have two or three employees, you cannot afford to do paid family leave because you can’t afford to hire somebody to take their place, which is why I think the tax credit that we have in law now is really beneficial,” Ms. Fischer said.

According to the White House, fewer than a third of small businesses with 100 or more employees offer paid leave. Only 14 percent with fewer than 50 employees do. Ms. Fischer conceded that few small businesses have taken advantage of her credit, but she blamed the Treasury Department, under Mr. Trump and Mr. Biden, for dragging its feet on issuing detailed regulations and promoting it.

To Democrats, those proposals are not true leave. They are either loans off other needed benefits or too limited to make a difference. Ms. Gillibrand said that optimally, a stable, generous family and medical leave plan would be an “earned benefit” like Social Security and Medicare: Workers would pay into the system and claim the benefit when they needed it, regardless of where they worked or how much they earned.

But, she said, taxing workers has become politically difficult. Her 2013 bill envisioned family and medical leave insurance, financed by a small contribution from employers with each paycheck.

This year, the Biden administration and Democratic leaders opted to fund paid leave out of general revenues, bolstered by tax increases on the wealthy and corporations. They said the program was part of a broader “human infrastructure” effort to help children and young parents, which included child care support, a child tax credit and universal prekindergarten — and therefore didn’t need a dedicated funding source.

Article source: https://www.nytimes.com/2021/10/31/us/politics/paid-family-leave.html