Universal Paid Leave Gets Another Look

Universal paid leave is getting a second look from the D.C. Council at an Oct. 10, 2017, public hearing reviewing legislation to receive public comment on five pieces of legislation that would modify the new law.

The hearing will focus on five bills that were introduced to address concerns that the Universal Paid Leave Act of 2015 (UPLA), when fully implemented, could stifle D.C. business and workforce growth and duplicate benefits that exist in larger companies.

D.C. Council Chairman Phil Mendelson told Federal City Council (FC2) trustees in June that business objections sparked his decision to propose a reduction in the 0.62 percent payroll tax that underwrites the program.

UPLA, which took effect April 7, 2017, applies to individuals employed in the private sector and exempts D.C. government and federal employees. The program provides eight weeks of parental leave, six weeks of family leave and two weeks of medical leave.

“Any new leave policy puts us out of step with our neighboring jurisdictions and is going to be a threat to our job base, particularly a change that inserts the government in the middle of the employee-employer relationship. The bills being considered by the Council may be an improvement on current law, but they remain a threat to our city’s fiscal sustainability,” says Anthony Williams, FC2’s executive director.

Among the five bills being considered, the version with the most momentum appears to be a proposal from Phil Mendelson. His bill maintains the same levels of leave in the new law (eight weeks for care for newborns, six weeks for family care, and two weeks of self-care). Businesses with 100 or more employees would be required to “self-administer” this leave and pay a 0.15 percent payroll tax to subsidize smaller businesses.

Smaller businesses have a choice of self-administering at a cost of 0.15 percent of payroll or deferring to the D.C. government by paying 0.54 percent. Employers that self-administer must provide benefits starting July 1, 2018; payroll tax contributions start July 1, 2019.

Another bill being considered would require employees to pay a portion of the 0.62 percent payroll tax being levied to support the program.

To learn more about this issue, contact Kevin Clinton: kclinton@federalcitycouncil.org