While the Executive’s Paid Leave Proposal doesn’t place the direct cost burden of this benefit onto employers, there are many aspects and consequences inherent in this new state mandate we believe will have a negative impact on the economy. Even if employers are not bearing the direct cost of paying the employee while on leave, they must bear the frictional cost of replacing an employee, training a new employee, the costs of placing a new or temporary employee, additional overtime costs to replace time lost, and a general loss of productivity.
Unshackle Upstate does not support the Executive’s Paid Leave Proposal but would like to provide reasonable augmentations to the proposal for consideration that would limit the impact of the aforementioned burdens on Upstate New York.
Small Business Exemption:
As proposed, the new paid leave mandate in New York would include all employers, irrespective of size, without any exemption for small employers. We believe this one size fits all model does not adequately factor in the wide range of employment situations that exist in our modern, mobile and information-based economy. Legislation that does not provide any flexibility for employers to craft their own time-off policies based on the needs of the company and its personnel will place a particularly harsh burden on the small, independent businesses that drive the Upstate economy.
Federal leave programs (FMLA) currently exempt businesses with fewer than fifty employees as does Connecticut’s paid sick leave law. We believe these models better reflect the diversity of Upstate’s employer community and New York should include a similar small employer exemption.
We do not dismiss the notion of an “opt-in” mechanism for businesses under the hypothetical size threshold.
Eligibility:
Under the Executive’s paid leave proposal, employees must be employed for just 4 weeks before becoming eligible for the paid leave benefit. This provision should be expanded to at least one year of employment before benefit eligibility begins to ensure that employees taking leave have demonstrated some tangible intent to return to the employment with their employer.
Current FMLA eligibility requires employees to have worked for an employer for at least 12 months with at least 1,250 hours of service during the preceding months.
Length of Benefit:
The Executive’s Proposal grants paid leave for a total of 12 weeks. The duration of this benefit is significantly longer than currently enacted state leave laws and should be changed to a maximum of 6 weeks; New Jersey and California both offer 6 weeks of paid leave while Rhode Island’s benefit is four weeks.
We would also advise language that protects against the direct cost burdens of this benefit being shifted at a future point in time to employers or the taxpayers of New York State.