Family Leave, Asked And Answered

This editorial appeared in the Philadelphia Inquirer on June 26th from Kathleen A. Davis of the Chamber of Commerce of Southern New Jersey.

The message that the business climate in New Jersey is less than hospitable is falling on deaf ears in Trenton.

The Chamber of Commerce Southern New Jersey has presented study after study and anecdotal evidence that demonstrates the challenges of operating a business in our state.

We've given state officials information on surveys that rank New Jersey last in a small-business survival index and third worst in its business tax climate; show we're ahead of only six states in our ability to compete for businesses to locate or stay in our state; show that business leaders throughout the country believe ours is the most likely state to reduce or eliminate business incentives; rank New Jersey 46th in private-sector job growth; and present data where 83 percent of respondents in a survey of chamber member companies graded our state's business climate a C or less, with 36 percent giving it a failing grade.

Despite this evidence, there is an inexplicable desire to push through an AFL-CIO/CWA agenda item that lacks any evidence that it is needed - paid family leave. Under the guise of "balancing work and family," this proposal would allow workers to take up to 10 weeks off every year to care for a newly born or adopted child, or to care for a sick family member. Benefits would be paid out of the state disability fund and funded by a payroll tax.

Paid family leave will not only cost business and taxpayers money, but also will disrupt the work/family balance for those employees who would have to work longer hours because they have to take on additional duties of those out on leave.

The cost to business is obvious. Having one or more employees out for extended periods of time will burden other employees who will have to cover their coworker's tasks. This will result in lower morale, increased overtime costs, and decreased productivity. Further, the cost of replacing an employee includes a premium on top of the hourly pay rate. Finally, as more employees avail themselves of paid leave, businesses will simply find it more difficult to remain competitive.

If passed, taxpayers can look forward to footing the bill of what will certainly become an entitlement for government workers. Following California's lead, state and local government employee unions will likely negotiate for government (therefore, taxpayers) to not only pay full salary during this leave, but also to pay the tax that funds this benefit.

Proponents of paid family leave seem to ignore the fact that New Jersey is one of only five states that provides paid maternity leave (a minimum of 10 weeks). They also point to a study conducted by the Center for Women and Work at Rutgers University. Ironically, it demonstrated that all of the employers in the study successfully made arrangements with workers to accommodate needed leave time because they have the flexibility to do so.

Legislating employee benefits for the private sector in such a tenuous business climate is dangerous public policy. Union leaders should do their jobs at the bargaining table and be consistent in their cries to the legislature to "negotiate, don't dictate!" We can't help but recall the testimony of labor leaders last fall, who asserted the Legislature had no authority to dictate benefits unilaterally - that wages and working conditions of workers should be determined through collective bargaining - a sacred principle for unions! On this point, we couldn't agree more. Let employers - not government - decide which benefits to offer in order to attract and retain talent in this highly competitive global economy.

I don't know what is more odious; the insinuation from Davis that other workers would have to pick up the slack for those individuals in need of family leave or her speculation that those workers in need of leave would only ask for more concessions in the future.

Anyway, this letter to the editor appeared in response in today's Inquirer.

A recent attack on family-leave insurance by Kathleen A. Davis, executive vice president of the Chamber of Commerce Southern New Jersey, fails to grasp the realities of the 21st-century economy ("Legislation on family leave unneeded," June 26). One of the hardest jobs anyone has today is balancing work and family. Conflicts are inevitable, often involving having to care for a sick child, spouse or parent.

Family-leave insurance in New Jersey would let men and women take some time off at reduced pay (but at least some pay) for family emergencies. Employees would pay (on average, under 50 cents a week) into a fund that would provide those needing it up to 10 weeks off at two-thirds pay (capped at $502 a week).

During legislative hearings, small-business owners from the New Jersey Time to Care Coalition came in support of family-leave insurance. They understand they won't have to pay a penny into the fund. They know workers who get time to help their families are more productive.

A study by the Center for Women and Work at Rutgers University found employee turnover costs far exceed the cost of providing employees' leaves. It also found that while many New Jersey small-business owners (under 50 employees) already give time off to care for family members, they regret being unable to provide any pay.

Business groups against family-leave insurance fail to note the legislation doesn't require small businesses to save the job of anyone taking leave. But at least the fund the workers paid into will provide financial help for a while. What is antibusiness about that?

Economic life today is difficult. It requires partnerships among working people, businesses and government to make things work. Family-leave insurance is just that.

Eileen Appelbaum
Director,
Center for Women and Work, Rutgers University

Jon Shure
President,
New Jersey Policy Perspective

To learn more about family leave insurance across the country (well, most of it anyway – maybe Pennsylvania will exit from the dark ages on this issue eventually), click here.