The push for expanding paid parental leave is gaining steam, and local businesses could soon be asked to shoulder more of the compensation load.
California currently offers employees up to six weeks leave with 60 to 70 percent of their weekly wages, but Gov. Gavin Newsom included an ambitious proposal in his January budget that would expand the state’s offering to up to six months of paid parental leave.
L.A. City Councilmembers David Ryu and Nury Martinez have also proposed a plan that would expand the state’s paid leave benefits. However, while the current state plan is paid for through employee payroll deductions, businesses would foot the bill for Ryu and Martinez’s extension.
The proposal would require businesses within the City of Los Angeles to cover the gap between the benefits currently offered by the state and the employee’s full weekly wages.
The local push comes as federal officials make a concerted effort to expand paid parental leave. Those efforts include a bill introduced earlier this month – the Family and Medical Leave Act – sponsored by Sen. Kirsten Gillibrand, a New York Democrat, and Rep. Rosa DeLauro, D-Conn. First daughter and presidential adviser Ivanka Trump has reportedly been working on paid parental leave legislation with Republicans on Capitol Hill as well.
Numerous studies have shown the benefits of paid parental leave, both for the baby and the parent, but there are also signs that providing paid leave benefits employers as well.
YouTube Chief Executive Susan Wojcicki wrote in a 2016 tweet “When Google increased paid maternity leave from 12 to 18 (weeks), the rate at which new mothers quit fell 50%.”
Keeping new parents in the workforce can save companies money. A 2012 case study from the Center for American Progress found that once the costs of hiring and training a new employee are factored in, businesses end up spending “about one-fifth of a worker’s salary to replace that worker.”
Of course, those benefits could very well be offset by how much the business must pay the employee on leave as well as the cost of a temporary replacement.
Large companies may be able to handle the costs associated with this proposal (indeed many already offer paid parental leave in the hopes of attracting high-level talent in a tight job market), but the same cannot necessarily be said for our city’s small businesses.
There’s no denying that the United States lags far behind much of the world when it comes to caring for our nation’s workers, and a more generous paid parental leave plan that’s available to more workers is a laudable idea. However, we hope lawmakers at both the local and national level manage the balancing act needed to ensure these proposals are beneficial to both employees and their employers.
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