In the midst of a drama-filled and drawn-out battle over the new 2017-19 state budget, the Washington State Legislature quietly passed legislation during the final hours of the third special legislative session to make Washington the fifth state to impose a paid family and medical leave mandate.
The sweeping new law forcing every employer to give every worker paid time off for family or medical reasons sailed through the House and Senate and was quickly signed by the governor.
Beginning Jan. 1, 2020, every worker in the state will be eligible to collect the most generous paid leave benefits in the nation (up to 18 weeks of paid leave annually with a maximum of $1,000 per week in replacement wages). The leave can be used for the birth or adoption of a child, or to care for a sick family member or the employee’s own serious health condition. Employers and workers will fund the program with a new payroll tax the state will begin collecting on Jan. 1, 2019.
Regardless of how you feel about the new law, the process that brought us here is worth examining.
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Unlike most other labor mandates, many of the most active and influential representatives of the business community pushed for the new paid family and medical leave law. In fact, they actually helped write it. They did so not because they believe the new mandate will be good for their business, but because they were afraid of voters approving something worse.
Labor unions threatened to run an initiative that would have required employers to give up to 38 weeks of paid leave per year with the entire program possibly funded by a tax on employers only.
Rather than risk voter approval of such a radical approach, many in the business community and some Republican legislators decided to push for their own paid leave proposal.
It was a lesson learned from last year’s Initiative 1433. After the business community convinced Republicans to hold the line on attempts by labor unions to increase the state’s minimum wage to $12, unions financed I-1433. Voters approved the measure and now employers are facing a $13.50 minimum wage and a paid sick leave mandate.
With statewide polls showing voters would likely approve an initiative to require paid family and medical leave, the business community decided not to roll the dice again. So they gave in to labor and the Democrats and tried to hammer out the best deal they could.
Sen. Michael Baumgartner, chair of the Commerce, Labor, and Sports Committee, the Senate committee that holds hearings on labor-related policies, expressed concern that while the paid leave law was negotiated by some members of the business community, every one of them that he has spoken with has said “we don’t like the policy, but we’re afraid of an initiative.” Sen. Baumgartner called it “legislative coercion.”
The head of the Washington chapter of the National Federation of Independent Business agreed with Sen. Baumgartner about feeling coerced: “Our members feel like they’re under siege; so either the Legislature does something less bad to them or they get something worse at the ballot box.”
Adding to this concern is the rushed process by which the new paid leave mandate became law. By the time an agreement was reached, the clock was ticking on the third special session. What followed was a last-minute rush to push through an unprecedented government mandate and a new tax on employers and workers.
Why the hurry? There was no chance of an initiative qualifying for the ballot this year, labor unions could not have made good on that threat until November 2018. A better course would have been for lawmakers to hammer out an agreement now and vote on the bill when the 2018 Legislative Session begins next January. This would give businesses and workers around the state ample time to learn about, and have a say in, the paid leave program they will pay for.
While there are certainly differing opinions on mandating that employers and workers pay for a government benefit they may not want (at Washington Policy Center we believe employee benefits work best when they are voluntary, based on what workers want and what employers are willing to provide to attract the best talent), we should all agree the 11th-hour timing of how this new law was crafted and passed leaves much to be desired.
Mandating a new benefit may make lawmakers feel generous, but it is workers and employers who pay the bill. Worse, they may be paying for a benefit they may never use and do not want. Of course, that is the inherent flaw of government mandates; they are based on force. At the very least, the state’s workers and employers deserve a better process to explore and debate the merits of such policies.
Erin Shannon is the director of the Center for Small Business and Labor Reform at Washington Policy Center and manages WPC’s Olympia office. She has testified numerous times before legislative committees on small business issues. She holds a bachelor’s degree in political science from the University of Washington.