Paid leave proposal prompts objections from Garfield County organizations
A broad family leave proposal in the Colorado Legislature has attracted the opposition of local organizations.
The Glenwood Springs Chamber Resort Association and Colorado Mountain College have voiced their opposition to the Family and Medical Leave Insurance (FAMLI) Act, a broad parental and medical leave proposal that opponents say could hurt some businesses if enacted.
“While we agree that paid leave is an important benefit, we also believe a flexible program that [incentivizes] employers to provide more leave and balances costs and benefits is a far better approach than a one-size-fits-all mandate,” Glenwood Chamber President Angie Anderson said in a statement.
The FAMLI Act would create a system to “provide partial wage replacement benefits” for up to 12 weeks leave for workers in a variety of situations, including child care, personal or family health conditions, abusive situations, or during a family member’s military service.
The program would be administered by a new division in the Department of Labor and Employment, and paid for with mandatory payroll fees from all workers, matched with funds from Colorado employers.
The act adopts a definition of family that includes immediate family members as well as “any other individual with whom the covered individual has a significant personal bond that is like a family relationship, regardless of biological or legal relationship.”
Employees would be responsible for part of the fees, and employers would match the payroll deductions. Recent amendments to the bill change the amount of the premiums based on business size.
Paid leave was on Gov. Jared Polis’ list of priorities when he assumed office in January, and the Democrat-controlled Legislature is working hard to create the new program.
The bill had one hearing in the Senate Committee on Business, Labor & Technology on March 13, during the “bomb cyclone” blizzard that hammered the Front Range.
The Senate Finance Committee held a public hearing on the bill March 19, where dozens of businesses and organizations voiced their opposition to the proposal.
CMC says costs too high
The Colorado Mountain College board of trustees voted unanimously March 20 to oppose the introduced version of the FAMLI Act, before new amendments were proposed, after a staff review “determined that SB 188 will profoundly and adversely impact the cost and the package of employee benefits presently being offered by the college.”
CMC conducted a fiscal review of the first version of the bill, and estimated that it would cost the college around $250,000 per year, plus the amount deducted from employees’ paychecks, CMC Chief Operating Officer Matt Gianneschi said in an interview.
The college would likely have to hire two more employees to assist in administering the new benefits, according to Gianneschi’s review. But he said the college had not analyzed the effects of the amended version.
“Our fear is that, if a new benefit is imposed on top of our existing structure, we’re going to be forced to change our benefits, which we think are working well for our employees,” Gianneschi said.
Most businesses would pay 0.64 percent of an employee’s salary for the first year the bill would take effect, and workers would be responsible for the same amount.
For someone making $40,000 a year, that would equal $128 in annual fees for the program and the same amount matched by the business, according to a fiscal note on the introduced version of the bill.
Amendments that have not yet been adopted reduce the premium percentages for small businesses and small government entities.
While government organizations would pay lower premiums than larger businesses under the amended FAMLI Act, the program could affect current benefits.
county already offers leave
Garfield County government currently offers employees up to 26 weeks short-term disability leave for employees with documented medical conditions, with 60 percent salary.
“In our case, it would result in increased cost for our employees because right now they don’t pay anything,” said Diane Hayes, human resources director for Garfield County.
Hayes said the county staff has not evaluated the effects of the act.
The benefits for those on leave would be calculated based on the how the weekly pay compares with the state’s average weekly wage.
According to Jennifer Greenfield, assistant professor at the University of Denver’s Graduate School of Social Work, which has a campus in Glenwood Springs, family leave programs can help small and rural businesses.
In small businesses where there are typically lower salaries and fewer benefits, “workers are more likely to just drop out of the workforce when they don’t have paid leave available,” Greenfield said.
“We see a higher public benefit,” she said. “Having leave enables those small businesses to retain that worker, and not have to hire someone new. I think that dynamic is stronger in rural areas where the businesses do tend to be smaller, and it’s harder to bring new workers in.”
In states like California, New Jersey and Rhode Island, which have similar paid leave programs, Greenfield said small businesses are experiencing more neutral or even positive outcomes than negative effects.
The Legislature’s fiscal note indicates that the fees deducted from paychecks and paid by businesses are not subject to TABOR — which requires voters to approve all new taxes — because the FAMLI fund would be a state enterprise.
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