IBM Issues Public Comment on Labor Department Notice

WASHINGTON, Sept. 17 -- David N. Barnes, vice president for global workforce policy at IBM Corp., Armonk, New York, has issued a public comment on the Department of Labor notice entitled "Request for Information: Paid Leave". The comment was written and posted on Sept. 14, 2020:

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IBM appreciates the opportunity to submit comments on the Department of Labor Women's Bureau Request for Information (RFI) regarding the current state of paid leave programs.

Our response to this RFI centers on IBM's strong support for a federal legislative solution that would enable employers to opt in to a single, national paid leave program that provides flexibility for employers and employees alike. Employers meeting the criteria of such a program would satisfy compliance requirements throughout the country and could provide all employees nationwide with uniform benefits.

Our position is rooted in IBM's experience as a large, multi-national employer with employees in all 50 states and in more than 170 countries world-wide. We have a long history of providing flexible time off to employees for health-related and other reasons as part of a generous and competitive benefits package. For example, for regular U.S. employees, IBM offers a paid leave policy that includes a minimum of 15 days of paid vacation; up to 26 weeks of full or partially paid short term disability; up to 12 weeks of paid parental bonding leave for new parents; paid care leave for family care, marriage or bereavement ranging from 3 days to 4 weeks depending on the use; in addition to paid sick leave. We recently created new paid time off offerings in response to the COVID-19 public health emergency which includes up to four weeks of emergency paid care leave for parents and caregivers for emergency family back-up care.

Our challenge, however, is not in providing paid time off benefits to our employees. Instead, the growing challenge is created by the myriad inconsistencies of the increasing number of state and local laws, the speed at which new laws and changes to existing laws take effect, and the sheer number of requirements applicable to IBM's operations around the country. Moreover, compounding these challenges is the need to coordinate IBM benefits, which are frequently more generous, with these state and local mandates.

With respect to paid sick leave and family and medical leave, because IBM is a federal contractor, we comply with the federal Executive Order establishing paid sick leave, as well as all state and local laws on paid sick leave and paid family and medical leave. There are currently 15 states, the District of Columbia, and roughly 15 municipalities with paid sick leave requirements, and the list is growing each year. These laws vary with respect to the rate of accrual, accrual and use caps, qualifying uses, covered family members, ability to frontload and notification requirements -- making it near impossible for an employer to craft a uniform and consistent policy for its national workforce. In the wake of COVID-19, several states and municipalities passed emergency paid sick leave laws to address employee needs due to the public health emergency. At the same time, IBM created its own paid time off program in response to the pandemic; however, we must also comply with the new and varying administrative hurdles imposed by the new state and local laws. There are also 6 states, plus the District of Columbia, that have paid family and medical leave laws, with 2 more states who have passed such laws to take effect in the near future.

Before COVID-19, an IBM employee could be covered simultaneously by as many as 4 different laws addressing the duration and amount of paid leave available for an employee illness or the illness of a covered family member (not to mention the FMLA, which covers unpaid leave in similar circumstances). For example, an employee working on a federal contract in San Francisco would be covered by Executive Order 13706, the California Healthy Workplace, Healthy Family Act, the San Francisco Paid Sick Leave Ordinance and the California Paid Family Leave Law, all of which may have different time off, covered family members, reporting and record keeping requirements. Today that same employee would be covered as well by an additional leave law: San Francisco's Public Health Emergency Leave. While all of the laws provide that the most generous provisions apply, it requires significant time and resources to identify the most generous entitlement and ensure compliance with all applicable requirements.

The simplified, national approach to paid leave that IBM seeks would provide the kind of flexibility that allows for the creation and progression of employment policies based on our employees' specific needs and priorities. Such an approach would greatly reduce costs and mitigate the staggering and growing administrative complexity while allowing employers to continue offering and designing generous leave benefits that would not vary based on where they work. The elimination of inconsistent and competing requirements should encourage even more companies to voluntarily provide paid sick leave and/or paid family and medical leave to employees, whether or not it is required.

Once again, IBM appreciates the opportunity to provide comments on this important issue. For any questions, please contact Yelena Vaynberg at [email protected].

Sincerely,

David N. Barnes

Vice President Global Workforce Policy

Government and Regulatory Affairs

IBM Corporation

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IBM Responses to Select Questions

3. What could be done to improve the existing patchwork of programs, which include state and employer-sponsored paid options?

Large employers with employees in several states need a federal legislative solution that would enable employers to opt in to a single, national paid leave program that would satisfy compliance requirements throughout the country simultaneously. Such a simplified approach would greatly reduce costs and mitigate the staggering and growing administrative complexity, while allowing us to continue offering and designing generous leave benefits that would not vary based on where employees work. Any federal solution should consider the following principles:

* Adhere to the definitions, standards and procedures used in the federal Family and Medical Leave Act (FMLA). This includes the criteria for eligibility, qualifying reasons for leave, identical leave durations, covered family members, standards for job protection, and other administrative procedures governing how leave is managed and tracked. The benefit of the FMLA provisions is that they present a common set of standards that most large employers understand and satisfy as the FMLA has been in place for more than 25 years. However, a similar, alternative set of common, uniform federal standards could also suffice.

* Simplify and standardize procedures for employee notification, applying for benefits, tracking, and reporting to minimize the administrative burden on employers. Procedures should closely follow those required under the FMLA.

* Exempt employers from meeting administrative requirements if they self-finance benefits (including using private insurance carriers) and substantially comply with any new federal standards on paid sick leave and family and medical leave. Most important, employers that substantially comply with federal standards should not be required to meet state or local requirements on paid sick leave and paid family and medical leave.

* Finance wage replacement payments through employee contributions to help minimize the impact on small and medium-sized businesses, the approach taken by most current state paid family and medical leave laws. Contribution amounts should correspond to employee income and benefit amounts to minimize any negative economic effects on employees and employers.

* Provide employers the option of paying premiums, or a portion of premiums, on behalf of employees should a company be required to deduct employee contributions to fund benefits.

* Allow employers flexibility to treat different types of employees differently within the parameters of the legislation provided all minimum requirements are met. This would include the use of different funding mechanisms to cover leave, providing more generous benefits, and/or using different 12-month periods and accrual methods based on employee type.

5. Are individual businesses, localities, states, or the government best equipped to provide standards for paid leave? Are employer-based or state-based programs more effective in the administration of paid leave programs?

Given the number of different paid family and medical leave and paid sick leave programs around the country, we recommend the enactment of national legislation to create a single uniform standard for paid family and medical leave while also providing flexibility and opt in options for employers already providing generous leave policies for their employees. To be effective, the national legislation would need to preempt inconsistent state and local mandates.

7. Do employers who already offer paid leave programs continue to do so when state mandates or programs are instituted, or do such mandates lead some employers to drop more generous programs?

The burden of compliance coupled with inconsistencies in the state and local laws and the range of different requirements mean that the resources designated for such programs are applied to navigating administrative complexities rather than program design and execution, which add value and enhances employee engagement. Consider the following scenario: an employer in the District of Columbia that already provides paid parental bonding leave must now pay into the DC program that offers among other benefits paid parental bonding leave. In this hypothetical, the employer-paid parental bonding leave is more generous at full pay for 12 weeks. Thus, employees would inevitably opt into their employer-provided benefits. Yet without flexibility, this employer must simultaneously pay its employees for paid parental bonding leave while also paying contributions to the District of Columbia for the very same benefits that its employees do not need or want. Employers in this situation may understandably be inclined to terminate their parental bonding policy rather than paying twice for the same benefits.

One-size-fits-all mandates without flexibility for employers may drive employers to reduce or eliminate benefits. Eliminating inconsistent and competing requirements could encourage more companies to voluntarily provide paid sick leave and/or paid family and medical leave benefits to employees regardless of whether it is required.

8. What are the features of an ideal paid leave program, from the perspective of a worker or employer? For example, should it be permissible to take leave intermittently? Should there be a time period within which intermittent leave must be taken?

Predictability and flexibility are important in a paid leave program for both employees and employers. It's important for employees to understand available benefits in advance as well as how to apply for those benefits. Employers should be able to provide and easily administer a uniform benefits program for all employees working in the U.S. based on the specific needs of its workforce. Due to different state mandates, we inevitably have different processes IBMers must follow, as well as different benefits available, depending on where employees work. Eligibility rules, applications for benefits, and benefit amounts and duration vary based on jurisdiction. This is not ideal for a national employer who wants consistent and uniform benefits that employees may access in a user-friendly way.

Employers need flexibility so we can customize leave benefits to address employee priorities. For example, in response to employee feedback, we added paid care leave to support IBMers and their families through personal and family situations. Paid care leave can be used to care for a family member, celebrate a marriage, or for bereavement. Family care, one aspect of paid care leave, is typically covered by paid family and medical leave programs, yet marriage and bereavement leave are not.

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The notice can be viewed at: https://beta.regulations.gov/document/DOL-2020-0004-0001

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