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Big Business Asks Congress for Protection From Local Paid Leave Laws

  • HR Policy Association seeks ‘safe harbor’ from local mandates
  • Executives from Marriott, IBM, GE, Wendy’s back new report

During the 2016 presidential campaign, both Donald Trump and Hillary Clinton pledged their support for more paid family leave. Now big business is countering the calls with a proposal of its own: Congress should establish a certain optional amount of paid leave and, if companies meet that threshold, they should be protected from state or local laws that might require more.

The proposal is part of a report being released Tuesday by the HR Policy Association, a coalition of more than 380 major U.S. companies. Together, the group’s members employ 9 percent of America’s private-sector workers. Executives on the committee behind the report represent companies including Marriott International, Procter & Gamble, IBM, Cigna, General Electric, Wendy’s, Oracle and General Mills.

The preemptive strike from the business community is also a response to the increasing number of states and municipalities that have taken matters into their own hands, passing local laws that require employers to offer paid time off.

Companies that already provide paid leave “should be encouraged to continue to do so,” said Cigna Executive Vice President John Murabito, who serves on the board of the HR Policy Association and on the committee that put together the report. “One clear way of doing that would be to provide relief from widely varying state and local mandates.”

Top companies

As of now, federal law offers many employees the opportunity to take unpaid family leave, but doesn’t require employers to give workers paid time off for sickness or childcare, including maternity leave. Since 2011, seven states and dozens of cities have passed laws requiring companies to provide paid sick days. Another two states and the District of Columbia passed laws creating family leave funds and requiring companies to let their employees use them.

In places like California, Arizona, New York City and Minneapolis, new laws let employees accrue at least one hour of sick time for every 30 hours of work, or roughly one sick day for every six weeks of full-time work. Nationally about 61 percent of private-sector workers have access to some form of paid sick days, according to 2015 data from the Bureau of Labor Statistics. Twelve percent have some form of paid family leave.

In response to the spread of local regulations, conservatives and business groups have pushed state lawmakers to strip cities and towns of the authority to pass such measures. With the GOP now in control of the White House and both houses of Congress, said University of Michigan law professor Samuel Bagenstos, they have the chance to preempt states and cities nationwide -- a strategy that could establish precedent for other issues.

It would be unusual for Congress to override state or local mandates on pay or benefits, Bagenstos said. Federal employment law has generally acted as a floor -- establishing national minimum standards like a $7.25 hourly wage -- rather than as a ceiling.

During the campaign, Trump had proposed establishing a federal policy that would provide for six weeks of paid maternity leave for new mothers. The White House didn’t respond to requests for comment about the Administration’s paid leave plans, which have not been a central issue in the first 100 days of the Trump presidency.

Sympathetic Congress

Congressman Bradley Byrne, an Alabama Republican who chairs the Workforce Protections subcommittee, said he’s interested in the idea of a safe harbor. “People move across state lines, companies operate across state lines. We’ve got to bring some uniformity to this -- both for the companies’ sake, but more importantly for the employees’ sake as they move around,” he said.

The HR Policy Association says companies don’t need government regulation to be generous with their workers. “While many existing government policies assume employers will only treat their employees fairly if they are required by law to do so, the war for talent negates that assumption,” Merck & Co. executive vice president Mirian Graddick-Weir, who chairs the association, said in an email.

Current laws on the books still assume “that employers were likely to take advantage of employees, so we just need to put lots of protections in place,” said CIT Group chief human resources officer Jim Duffy. “Now really the shoe is clearly on the other foot -- the workers really have the leverage.”

Democratic Alternatives

Coming from companies that operate in multiple countries, complaints about the administrative headaches of complying with varying laws are a pretext for firms angling to stanch progress on paid leave, labor advocates say.

“This is creating a ‘safe harbor’ for the largest corporations at the expense of financial security for families,” said Ellen Bravo, founder of the coalition Family Values at Work.

For their part, congressional Democrats have in recent years repeatedly introduced proposals to establish federal minimums for paid leave, while still allowing states and cities to set their own higher standards.

“Because there has been a lack of federal action, you’ve seen communities taking this issue into their own hands,” said Heather Boushey, executive director of the Washington Center for Equitable Growth. “If the employers are frustrated that they have different systems, then we should be thinking about what is that basic benefit that we should be providing at the federal level.”

‘Too Intrusive’

That’s not an idea the HR Policy Association has embraced. “I think that probably feels a little too intrusive for our membership,” said Johnna Torsone, executive vice president of Pitney Bowes, who worked on the report and chairs the association’s Employment Rights Committee. Offering a safe harbor, she said, “feels more amenable” to industry leaders.

Pitney Bowes says it provides its staff with up to six paid sick days a year and eight weeks of fully-paid family leave, along with vacation.

“The question is,” said Torsone, “if you’ve provided a certain level of paid leave within your structure, should you be subjected to 30 different approaches to this and have to monitor it?”

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