HB 2005B Family & medical leave as universal benefit

VOTE: NO – Signed into Law by Gov Brown

Status (overview) of bill:https://olis.leg.state.or.us/liz/2019R1/Measures/Overview/HB2005

This bill transforms family and medical leave, the FAMLIE Equity Act, into a universal benefit affecting employers and employees each paying a portion of employee’s wages while they are out for reasons like a difficult pregnancy, injury or illness, a family emergency, or the birth or adoption of a child.

Fiscal Responsibility
Estimates include 20.75 FTE to administer the program at $15,688,586 for 2019-21 and $37,890,176 in 2021-23; plus Dept. of Revenue needs 7 positions for $858,254 in 2021-23; Dept of Justice needs $148,313 for 2019-21 and $165,460 for 2021-23; and other departments anticipate a need from the inter-program contracting with other agencies. These amounts are taxpayer paid on top of employee/employer contributions for employee benefit. At a rate set at the 1% maximum and the state pays 40% of the total rate, the employer contribution for state agencies approximately $21.5 million total funds per biennium is needed and the state pays $14.3 million – that’s taxpayer funded.

Limited Government
This bill creates a new program that is costly. State and federal laws currently allow workers to take unpaid family leave for 12 weeks per year, and in most cases, employers are obligated to let them return to their jobs. However, businesses with fewer than 25 employees are exempt. Current law doesn’t require that an employer pay an employee who is on family leave, although some do voluntarily. Under HB 2005B, family and medical leave would be paid for by insurance. Workers would put up to 1% of their earnings toward a state-run insurance fund, into which businesses would have to pay as well. In return, employees on leave would be eligible for benefits equal to some or all of their salary. Compensation would be pegged to a worker’s salary. Minimum-wage hourly workers would be eligible for full pay. For higher-paid workers, the insurance payments could cover most, but not all, of their normal wages. Caps eligible employee’s average weekly wage used in calculation at total yearly wages of $132,900. Caps weekly benefit amount at 120 percent of state average weekly wage (approximately $1,215) and establishes floor at five percent (approximately $50). Provides job protections for employees who utilize program. Authorizes maximum of 12 weeks of insurance benefits, with total paid and unpaid leave capped at 18 weeks. Authorizes use of vacation or sick time to supplement insurance, up to 100 percent of wages, with consent of employer.

Free Markets
Business owners worry that state mandates could cost them money in productivity and would incentivize more sick leave. Allows self-employed individuals and tribal government employers to opt into program. Requires employer to pay 60 percent of contributions and employee to pay 40 percent. Exempts employers with fewer than 25 employees from obligation to pay contributions

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