New Jersey’s paid family leave program could become available to more workers, pay out more generous benefits — and cost New Jersey workers more — if Gov. Phil Murphy signs legislation that Democrats in the Legislature have sent him.
The bill (A-3975) would double the amount of time workers could take leave, pay them a higher weekly check and open the program to those who work for smaller employers. It would also increase the amount of money workers pay to fund the program. While Murphy has not said whether he would sign this bill, he backed a similar bill 18 months ago while he was a candidate for governor and former Gov. Chris Christie had the pen.
“Expanding paid family leave would ensure families will be able to care for a loved one without having to worry,” Murphy wrote on his Facebook page at the time. “It is the compassionate and fair thing to do for working families.”
Christie vetoed that measure.
After Murphy took office, legislative Democrats reintroduced the bill, which would also expand the state’s temporary disability insurance program. It went through several amendments, making it somewhat less generous than originally proposed, in the eight months it was pending. Both the Senate and Assembly passed the final version, along party lines, on January 31.
Many workers still would not be eligible
Advocates who have been pushing for better benefits for years are not completely happy with the final version — it still would leave 800,000 people who work for small businesses with 30 or fewer employees ineligible for job protection if they take leave. Nonetheless, they are eager to see Murphy sign the measure.
“By increasing leave times and benefits, strengthening job protections and public awareness programs and expanding the definition of family, this bill would ensure that our paid leave program does what it was intended to do: Give workers, including those with lower incomes, time to care for our loved ones when they need us most,” said S. Nadia Hussain, maternal justice campaign director at MomsRising, an organization representing more than 1 million mothers and their families.
Business representatives, on the other hand, say the changes are too generous for companies.
“Expanding the length of paid family leave will force small businesses to pay more overtime to workers or hire replacement employees for longer periods of time,” said Mike Wallace, vice president of government affairs for the New Jersey Business & Industry Association. “With the legislation lowering the exemption threshold from 50 to 30 employees, more small businesses will be adversely impacted.”
But advocates and lawmakers say participation in the current program, which provides benefits to those who take time off from work to care for a new child or a sick family member, is relatively low because people don’t know they are eligible for the time off, can’t afford to live on the low weekly check it provides, or fear they could wind up out of work because they lack job protection. Only about 12 percent of eligible new parents in New Jersey take family leave on average every year. (Depending on the situation, people are supposed to give advanced written notice of their need for leave when possible.)
“It has been 10 years since New Jersey passed only the second state paid family leave program in the country,” said Yarrow Willman-Cole of the Center for Women and Work at Rutgers University’s School of Management and Labor Relations. “We have learned a lot about what makes these programs more effective in reaching people who otherwise might be forced to make a decision between paying rent or taking adequate time off to recover from childbirth or surgery, or to care for a family member facing a serious health crisis. We know that the program is being underutilized by workers who need to take leave and this legislation will address many of those barriers.”
What’s in the bill
New Jersey remains one of only six states, plus the District of Columbia, to offer paid family leave.
If enacted, the bill would:
Workers would have to pay more
The measure also would increase the amount all workers in the state pay to fund the program. Currently, it is funded by a small tax on a portion of salary that changes each year; this year, that’s 0.08 percent of salary up to $34,400 to a maximum of $27.52. The fiscal note on the bill estimates that in 2021, the state will take in an additional amount as high as $407 million and pay out as much as $365 million more. Only workers pay into the family leave insurance fund, while both employers and employees pay into the disability insurance fund.
To pay for the expected increase in payments from the family leave insurance fund, the bill would assess a tax on salaries up to about $128,000. Assuming a 0.08 percent tax, that would increase the maximum worker’s payment toward family leave insurance to $102.40, almost quadrupling the current tax.
Advocates indicated they would continue to work to ensure that all workers could take family leave without fearing retribution by pushing to require coverage for those who work for very small businesses. All workers pay into the program.
“A key component preventing workers from accessing their time is fear of job loss,” Willman-Cole said. “To deal with that, we need to guarantee that all workers have their jobs protected when taking necessary leave from work.”