New York Family Leave ‘Doesn’t Appear to Hurt Employers,’ New Study Finds

‘s paid family leave policy “has imposed minimal costs on employers,” suggests a new study released by the National Bureau of Economic Research, and may even have some advantages. The statewide policy, which took effect in January 2018 and is funded by an employee payroll tax, “does not appear to hurt employers,” study co-author Maya Rossin-Slater, an economist and researcher, told MarketWatch. Associate Professor at Stanford University School of Medicine. “It seems to improve their ease of managing worker absences, at least in the short term,” he added.

The authors of the working paper responded to a survey between 2016 and 2019 of employers with 10 to 99 employees in both New York and Pennsylvania, who do not have a paid family leave policy. They matched each New York company to a comparable Pennsylvania company and used a difference-in-difference approach to estimate the causal impact of the policy on employer outcomes. Overall, more than 4,500 unique companies participated in the survey in at least one year. Among the study findings: During the first year of the paid leave policy, employers ‘ratings of their own ability to handle workers’ long absences increased, although the effect appeared to be short-lived. While the reasons for this impact are “speculative,” Rossin-Slater said, his feeling is that “having a statewide policy provides a standardized system for employers to navigate situations where their workers need to take a license.” rather than one-time, case-by-case absences, with workers potentially making up for sick days and vacations. The researchers also found no evidence that the policy had any adverse effect on employer-rated performance markers, such as productivity, engagement, attendance, teamwork, and employee cooperation. “[A]Average employer ratings on these dimensions are already high in the years before the law, suggesting minimal scope for further improvements on them, ”the authors wrote. The second year after the policy was instituted, the study found a substantial increase in employees taking paid family leave, “concentrated among companies whose employees were previously ineligible for FMLA leave.” (The Family and Medical Leave Act, which grants eligible workers up to 12 weeks of unpaid leave in certain situations, applies to public agencies and private sector employers employing at least 50 workers.) New York politics both before and after its implementation, Rossin-Slater said. “Having said that, there is a small minority that is very opposed, and that participation grows over time,” he added. While it is difficult to know exactly why the proportion of opponents increased over time, qualitative evidence suggested that some lacked clarity on how the policy worked or how it was financed, Rossin-Slater said, which could include smaller companies without a solid human resources department.

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“In light of the pandemic, ‘it’s really important to understand how both workers and employers have been navigating this system where all of a sudden a lot of people have had to take time off.’ ”- Maya Rossin-Slater, Associate Professor, Stanford University School of Medicine

A key takeaway: “In general, most people do not believe that these policies are really going to be beneficial to employers. I think people are concerned that it is expensive, ”Rossin-Slater said. “The good news here is that they don’t seem to be expensive.” The United States is one of the only highly industrialized countries where there is no federal law that requires companies to provide paid family leave to employees. The District of Columbia and at least nine states – California, Colorado, Connecticut, Massachusetts, New Jersey, New York, Oregon, Rhode Island and Washington – have enacted their own paid family and medical leave laws, according to a tally by the Kaiser family. . Foundation, a group of health experts. Meanwhile, retailers like Target TGT, -0.23%, Amazon AMZN, + 0.98%, and Walmart WMT, -0.27% have introduced paid family leave benefits in recent years. Starting in October, federal workers can also receive 12 weeks of paid family leave. In 2020, only 20% of private industry workers and 26% of state and local government workers had access to paid family leave, according to the Bureau of Labor Statistics. In response to COVID-19, federal lawmakers passed the Families First Coronavirus Response Act (FFCRA), which temporarily granted workers who had been on payroll for at least 30 days an additional 10 weeks of paid extended family and medical leave in two-thirds. your regular pay rate, in addition to providing emergency paid sick leave. Under President Biden‘s $ 1.9 billion American Rescue Plan, the refundable paid family leave or sick leave tax credits available through the FFCRA now expire on September 30. The study distributed by NBER was limited by virtue of the fact that New York’s policy went into effect in 2018, Rossin-Slater said. She and her co-authors were only able to do business for two years before the coronavirus hit. In light of the pandemic, “it is really important to understand how both workers and employers have been navigating this system where all of a sudden a lot of people have had to take time off,” he added, be it due to COVID. -19 itself, children did not attend school in person or other family care needs. “What we don’t know is, how have employers fared in places that actually have paid leave policies at the state level during this time, relative to, for example, employers in places that have not had paid leave policies? at the state level? “She said.” I think that’s a big and important question. “Don’t miss out: California’s paid leave law has cost new mothers an estimated $ 24,000 over a decade, research shows. Also read: Do Businesses Suffer By Offering Paid Parental Leave? These Economists Believe They Have Found An Answer