New Federal Paid Family Leave Proposal Draws Bipartisan Support

05 August 2019 Labor & Employment Law Perspectives Blog

We’ve discussed on several occasions the patchwork of paid sick and family leave laws in cities and states across the country.  While the federal government has yet to take up the issue, this is one of the few topics that politicians on both sides of the aisle have shown a willingness to address.  Recent developments suggest that Congress may soon take action to create the first significant revision to federal law on family leave since the enactment of the Family and Medical Leave Act (FMLA) back in 1993.

Recent Democratic proposals for paid federal family leave have called for financing the program through an increase in the payroll tax shared by employers and employees (similar to the payroll taxes for Social Security and Medicare). 

Republican proposals, meanwhile, would allow parents to obtain paid family leave now by agreeing to delay the start of their Social Security payments.  Until now, no proposal has generated enthusiasm from a majority in Congress.

That may be changing.  In May, the Senate established a bipartisan working group to study the issue of paid family leave and to explore proposals that could generate broad support.  And just last week, Sen. Bill Cassidy (R-La.) and Sen. Kyrsten Sinema (D-Ariz.) teamed up to release the first bipartisan proposal to create a federal paid family leave benefit. 

The proposal is promising, in that it avoids some of the issues that have caused both sides to reject past paid leave initiatives.  Rather than creating a new tax or cutting retirement benefits, this proposal would allow new parents to accelerate a portion of their child tax credit for immediate pay following the birth of a child.  In exchange, the credit would be reduced over the following decade. 

As proposed, the program would be capped at $5,000 in immediate pay following the birth or adoption of a child.  In exchange for that upfront payment, the parents’ child tax credit would be cut from $2,000 to $1,500 each year for the following 10 years.  (The 2017 tax reform bill increased the child tax credit from $1,000 to $2,000, so even the reduced credit would still be greater than it was prior to the change in law.)

The proposal may have something to offer everyone.  It could appeal to Republicans (and employers) by not imposing a new tax, and it could appeal to Democrats by preserving existing retirement benefits.  Still, it remains to be seen whether Congress will act on this new initiative, especially as the political parties turn toward the 2020 presidential election.

In addition, even if this benefit is enacted, employers will likely still be required to comply with the myriad of state and local laws on this issue as well.  Any employer that operates in a state with its own version of FMLA knows that the federal law does not preempt all state laws on the topic.  This will probably be true for paid family leave as well.  Thus, for the foreseeable future, employers must continue to monitor the patchwork quilt of state and local laws to ensure they are in compliance everywhere they operate.

This blog is made available by Foley & Lardner LLP (“Foley” or “the Firm”) for informational purposes only. It is not meant to convey the Firm’s legal position on behalf of any client, nor is it intended to convey specific legal advice. Any opinions expressed in this article do not necessarily reflect the views of Foley & Lardner LLP, its partners, or its clients. Accordingly, do not act upon this information without seeking counsel from a licensed attorney. This blog is not intended to create, and receipt of it does not constitute, an attorney-client relationship. Communicating with Foley through this website by email, blog post, or otherwise, does not create an attorney-client relationship for any legal matter. Therefore, any communication or material you transmit to Foley through this blog, whether by email, blog post or any other manner, will not be treated as confidential or proprietary. The information on this blog is published “AS IS” and is not guaranteed to be complete, accurate, and or up-to-date. Foley makes no representations or warranties of any kind, express or implied, as to the operation or content of the site. Foley expressly disclaims all other guarantees, warranties, conditions and representations of any kind, either express or implied, whether arising under any statute, law, commercial use or otherwise, including implied warranties of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Foley or any of its partners, officers, employees, agents or affiliates be liable, directly or indirectly, under any theory of law (contract, tort, negligence or otherwise), to you or anyone else, for any claims, losses or damages, direct, indirect special, incidental, punitive or consequential, resulting from or occasioned by the creation, use of or reliance on this site (including information and other content) or any third party websites or the information, resources or material accessed through any such websites. In some jurisdictions, the contents of this blog may be considered Attorney Advertising. If applicable, please note that prior results do not guarantee a similar outcome. Photographs are for dramatization purposes only and may include models. Likenesses do not necessarily imply current client, partnership or employee status.

Related Services