Reed Teams Up with Gillibrand to Introduce FAMILY Act to Provide Paid Leave for All Employees
WASHINGTON, DC – In an effort to help workers when they are sick or when they must care for a family member who is ill, U.S. Senator Jack Reed (D-RI) is joining with U.S. Senator Kirsten Gillibrand (D-NY) and 25 of their colleagues in introducing the Family and Medical Insurance Leave (FAMILY) Act. This legislation would create a universal, gender-neutral paid family and medical leave program.
“The vast majority of working families don’t have access to paid leave, and as a working mom, I understand the urgency of this problem,” said Senator Gillibrand. “Every day that goes by without a national paid family leave program, workers will continue to lose income, they’ll continue to lose their jobs, and businesses will continue to lose employees. We need to pass the FAMILY Act and give every working American access to paid leave when they need it.”
“This is a smart, cost-effective plan to help businesses provide their employees with an insurance policy that boosts productivity and ensures workers can care for their family,” said Senator Reed. “No one should have to lose their job if they have a new baby or need time to care for ailing kids or parents. Paid maternity, family, and sick leave helps the health and economic well-being of individuals who have it and strengthens the bottom line for employers who can support and retain their workers. The FAMILY Act will help provide a measure of certainty to both employers and employees. It will ensure small businesses can compete, leveling the playing field so that they can provide their employees with access to paid leave.”
The United States is the only industrialized nation without a national paid leave program. The Family and Medical Leave Act (FMLA) gives certain employees 12 weeks of unpaid leave. Rhode Island is one of just four states, along with California, New Jersey, and New York, to have paid family and medical leave insurance programs in place. Rhode Island adopted its caregiving leave law in 2014. Of the nearly 13,000 claims filed by Rhode Islanders between 2014 and 2015, more than three-quarters were for parents bonding with a new child. The program is funded through employee payroll deductions and relies on the same pool of money that covers temporary disability insurance program.
Only 14 percent of American workers have access to paid family leave through their employer. Without a national paid family leave program, the U.S. economy loses almost $21 billion a year. According to a MetLife Study of Caregiving Costs to Working Caregivers, the proportion of adult children providing personal care and/or financial assistance to a parent has more than tripled over the past 15 years. As a result of lost wages due to leaving the labor force early and/or reduced hours of work because of caregiving responsibilities, women lose about $324,000 in wages and retirement benefits over a lifetime; and men lose nearly $284,000. A lack of a national paid leave program hurts businesses; studies show that businesses incur an additional 20 percent cost to recruit and retrain new workers replacing others who left because they did not have paid leave.
The FAMILY Act creates a self-sustaining family insurance program for all workers – young and elderly, single and married, and men and women, regardless of the size of their employer. Modeled after successful state programs, and costing only as much as a cup of coffee per week, the fund would provide up to 66 percent wage-replacement for 12 weeks in the event of a serious personal or family medical emergency.
Under the legislation, payouts to employees would be capped at $4,000 per month and the insurance program would be paid for with a 0.2 percent payroll deduction for employees that would be matched by employers.