The Healthy Delaware Families Act

The Unintended Side Effect of Paid Leave

BY JACQUELINE POQUETTE, JD, MBA, SPHR, SHRM-SCP

OPPONENTS OF GOVERNMENT-MANDATED paid family leave point to two reasons: inflexibility and costs imposed on employers. Even if employers do not have to fund the leave, they could face indirect costs from the need to hire replacement workers, coordinate employee schedules, or reassign work tasks. Additionally, a paid-leave mandate could lead to an increase in employee requests for policy changes allotting additional paid time off for those not protected by family paid leave, and may make less money available for pay raises, health insurance, and hiring more workers.

In addition to the financial cost to businesses to provide paid family leave, there are productivity costs as well. When an employee goes on leave for a number of weeks, that employee’s tasks need to be covered by other employees in the business, which can lead to a loss of productivity. Even if the business hires a temporary worker to cover the leave, it will need time to onboard and train the employee. If the goal of government-mandated paid family leave is to help families, then the focus should be on implementing policy options that increase flexibility and choices that families have, not reduce them. Government mandates limit employer flexibility. When employers struggle to comply with expensive or inflexible mandates, it makes it that much harder to accommodate the workers those policies are attempting to help.

It is furthermore not clear that mandated paid family leave is the option families find “friendliest” to their needs. By definition, paid leave creates a strong market bias toward full-time work, since those are the only workers eligible for the benefit. But there is plenty of evidence that flexible work arrangements and the availability of part-time work are highly successful at returning mothers to the workforce.

Now more than ever, employers are struggling to meet the demands of their businesses as they offer the competitive paid-leave programs and flexible-work arrangements necessary to attract and retain employees during a national crisis. Employers strive to develop attractive, cost effective employee benefit plans that meet both their needs as well as those of the employees. A government mandate imposing a one-size-fits all policy on businesses takes some of that choice away and creative ideas for providing paid leave—such as paid-time-off purchase plans that allow workers who want more leave to purchase additional paid time off either through employer flex credits or salary reductions with pretax dollars— will be no longer be available.

Since the passage of the Family and Medical Leave Act of 1993 almost 30 years ago, organizations, especially those under 50 employees have found ways to meet the needs of their employees while keeping their doors open so they can continue to serve the community. So, let’s allow businesses to continue making creative decisions that solve the unique needs of their individual workforces.

The purpose of these articles is to provide the platform for two perspectives to be shared. The views are that of the authors. View the other perspective here: https://issuu.com/destatechamber/docs/delaware_business_march_april_2022_7064/s/15080912

Jacqueline Poquette, JD, MBA, SPHR, SHRM-SCP, is the director of the Delaware SHRM State Council.