The Family & Medical Leave Act became law 21 years ago, one of the first bills signed by newly-inaugurated President Bill Clinton in 1993.

Over the years covered employers have learned the intricacies of FMLA compliance, including notice requirements to eligible employees, serious health conditions, intermittent leave issues, 12 workweeks of job-protected leave, special military family leave and state-by-state variations.

To be sure, FMLA regulations and case law have changed continuously since 1993, clarifying employer and employee responsibilities. Most recently the U.S. Department of Labor proposed new regulations revising the definition of spouse in light of the Supreme Court decision regarding same-sex marriages.

Through often conflicting court decisions and regulatory interpretations, however, there has been one constant: FMLA leave is unpaid leave. Eligible employees are entitled to up to 12 weeks of job-protected unpaid leave.  

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Paid FMLA Leave? What to Expect

Thu Aug 21, 2014

The Family & Medical Leave Act became law 21 years ago, one of the first bills signed by newly-inaugurated President Bill Clinton in 1993.

Over the years covered employers have learned the intricacies of FMLA compliance, including notice requirements to eligible employees, serious health conditions, intermittent leave issues, 12 workweeks of job-protected leave, special military family leave and state-by-state variations.

To be sure, FMLA regulations and case law have changed continuously since 1993, clarifying employer and employee responsibilities. Most recently the U.S. Department of Labor proposed new regulations revising the definition of spouse in light of the Supreme Court decision regarding same-sex marriages.

Through often conflicting court decisions and regulatory interpretations, however, there has been one constant: FMLA leave is unpaid leave. Eligible employees are entitled to up to 12 weeks of job-protected unpaid leave.

While a handful of states, notably California and New Jersey, have developed novel approaches to limited paid leave, federal law has not budged from the original principle that FMLA leave is unpaid. Until now.

This year Senator Kirsten Gillibrand (D-NY) and Representative Rosa DeLauro (D-CT) have introduced the “Family & Medical Insurance Leave Act,” a bill to create a partial paid family and medical leave entitlement. Such leave would be funded by a new payroll tax of 0.2% of wages, paid by employers and employees. The bill sponsors say the tax would amount to about $1.50 per week for a typical worker.

Proceeds from the new tax would go into a special Social Security Administration trust fund, which would pay benefits of 2/3 of an individual’s monthly wages up to a weekly maximum amount of $1,000.

What’s the outlook for paid FMLA leave?

Certainly the advocates make a strong case for their bill, citing the need for American workers to have access at least to paid sick leave. They point out, for example, that the U.S. is one of only three industrialized nations that lack mandatory paid maternity leave.

Indeed, the Institute for Women’s Policy Research estimates that more than 40 percent of U.S. private sector workers have no access to paid sick days.

Employer representatives, on the other hand, remain concerned that mandatory paid sick leave could prove difficult to administer, particularly in organizations that now offer the flexibility of personal time off (PTO). Also, FMLA compliance could become much more complicated if paid leave prompted more widespread use.

Meanwhile, some states and localities have forged ahead on the issue. New York City, for example, just this year approved a plan to mandate 5 paid sick days for employees, including caring for family members, effective in July.

Interestingly, President Obama has been cautious about the Gillibrand-DeLauro measure. At a June White House Summit on Working Families the president talked about paid family leave but stopped short of endorsing the legislation, according to the Washington Post (June 24, 2014). The White House appears reluctant to endorse a payroll tax increase on the middle class—something the president has promised not to do.

Clouding prospects for federal legislation are a politically divided Congress unreceptive to raising taxes and the perception of many on Capitol Hill that employers are already burdened by Affordable Care Act mandates.

Furthermore, other legislative priorities have consumed Congressional time and interest, including immigration reform, the minimum wage and highway project funding.

Taking all this into account, federal legislation to mandate paid FMLA leave seems dead for 2014 and even beyond. While there is no doubt a consensus that paid leave is an important national concern, mandating it by federal law is another question, and how to pay for it a bigger question still.

For now at least, Washington DC lawmakers are focused on other priorities, averse to new mandates and taxes and seemingly content to let states and localities decide for themselves what makes sense.