Senate Health, Education, Labor and Pensions Committee Hearing
Federal Information & News Dispatch, Inc. |
Good morrning, Chairrman Hagann, Ranking Member Ennzi and memmbers of thee Committeee. It is an honnor to be herre with you today to disscuss the be enefits of pa id family annd medical lleave for workeers and famiilies, busineesses and thhe economy..
My namee is Vicki Shhabo, and I aam Vice Preesident at thhe Nationall Partnershiip for Womeen & Families,, where I leaad the organnization's wworkplace isssues portfollio. The Nattional Partnershhip is a nonnprofit, nonppartisan advvocacy organnization ba sed in Washhington, D.CC. For moree than four ddecades, we have foughht for every mmajor policyy advance thhat has helpped women annd families.. We promotte fairness iin the workpplace, reprooductive heaalth and rights, access to quality, affordable heaalth care, annd policies thhat help woomen and mmen meet thee dual demmands of worrk and fami ly. Our goall is to createe a society tthat is free, fair and jusst, where noobody has too experiencee discriminaation, all workplaces ar e family frieendly, and eeveryfamily haas access to quality, affoordable heaalth care andd real econoomic securitty.
Introducttion: A Momment to Cre ate a Strongg Economy that Workss for All
This hearring comes aat an excitinng time. Lasst month att an historicc White Houuse Summit on Working Families, a dvocates, reesearchers, business leaaders and eelected officiials came together to address tthe transforrmation of AAmerica's ecconomy and its workforrce. Executivves from premmier Fortunne 500 comppanies and mmedium andd small empployers alikee made strong business cases for family friendlly policies, ddemystifiedd the act of ooffering suchh policies, aand shared thhe tangible rreturns theyy have seenn for their brrands, theirr revenues aand their peeople. Workers from acrosss the countryy spoke aboout the diffeerence thesee policies maake in helpiing them position their cchildren for success, carre for ailingg or injured elderly parents, attendd to their ownn serious health issues, and meet oother life ressponsibilitiees.
There is aa growing uunderstandinng that the need for paaid family annd medical leave is neaarly ubiquitouus, but for tooo long we hhave left inddividuals annd families tto search foor solutions on their ownn, rather thaan adoptingg solutions that work foor the nationn. The momment to channge that is noow. The urgent needs of families, tthe strong p ublic demannd, compelling employeer testimoniials, positiv e data fromm states and cities that hhave adopteed family friendly policcies, and clearr interest froom those in the privatee and publicc sectors all signal that it's time forr progress. At this momment, lawmmakers, empployers and aall of us muust do all wee can to transformm America i nto a nationn that truly reflects its family valuues rather thhan what itt has been - a nnation that pays lip serrvice to fammily values bbut takes litttle action.
In my remarks this morning, I will touch briefly on the new economic and demographic truths about work, wages and family that make this conversation about paid family and medical leave so important. I'll summarize the patchwork of laws and policies that leave too many people without the paid leave they need and deserve. I'll touch on economic, business and health evidence that makes paid leave so essential to our nation's progress. And I'll share thoughts on a roadmap for the way forward, toward an America where all workers can care for themselves and their loved ones without sacrificing their financial stability.
I. New Demographic and Economic Truths Reveal an Urgent Need for Change
The world of work, wages and family has changed dramatically, but our workplace policies and norms remain largely stagnant, addressing few of the challenges Americans face day to day as they struggle to manage the dual demands of work and family. Today, women make up nearly half the workforce and are the primary or sole breadwinners in 40 percent of families; n1 in just under another quarter of families, women's earnings contribute substantially to their families' incomes. n2 Most first children are born into households with mothers who were employed before and who return to work after giving birth, n3 and most children live in households with a single parent or both parents who hold jobs as they grow. n4
Despite dramatic increases in women's workforce participation and contributions as family breadwinners, women most often continue to be the primary caregivers for children at birth and during childhood - and for elderly parents. n5 It is true and very welcome that men are increasingly interested in, and taking on, more family caregiving, but most of the work continues to be done by women. n6
Economic pressures and precarious work conditions exacerbate the stresses that working families face. Stagnating wages and a persistent gender-based wage gap mean women - and all workers - are working later in life, for less, and are less able to save for the future. n7
Keeping a job - whatever the conditions, wages or access to basic standards like paid sick days, paid leave, retirement security or health benefits - is of paramount importance because wages from work mean the difference between staying afloat or falling down a financial rabbit hole and hitting rock bottom.
In addition, demographic trends underscore the urgent need to create family friendly policies. Women's workforce participation, which climbed substantially in
Our birthrates are also falling relative to other developed nations, which has significant implications for our nation and our workforce now and in the future. n11 Concerns about making ends meet, coupled with our nation's lack of family friendly policies and inflexible business cultures, play a role in this decline. Young people, in particular, see work demands as incompatible with parenting and say they may put off or avoid the latter altogether. n12
At the same time, our population is aging: Over the next 25 years, the number of adults 65 and older is expected to double. n13 By 2060, there will be 92 million older adults - accounting for more than 20 percent of the U.S. population. n14 This means many more workers will need time away from work to care for seriously ill parents and spouses. n15 Our nation needs to address the impending elder care crisis now.
All these factors make it absolutely critical that our country update its workplace policies and standards. In particular, we must ensure all workers in
We simply must end the days when millions of workers across the nation face devastating economic hardships as a result of significant family and medical events. There is no time to wait.
II. The Patchwork of Family and Medical Leave Policies Fails Too Many Families
A. Family and Medical Leave Act
First, although the Family and Medical Leave Act (FMLA) has been the law for 21 years and has been used more than 100 million times to help assure eligible workers the time they need to care for a new child, a seriously ill loved one or their own serous health condition, too many people are left out. In all, slightly less than 60 percent of the workforce (about 90 million workers) has access to unpaid leave under the FMLA. n16 But that means that four in 10 workers - or about 60 million - are left out by the law's exclusions of employees in smaller businesses, employees with less than a year on the job and employees who work part-time. n17 These workers have absolutely no right to take time away from their jobs to address serious family or medical issues, and if they do, they risk losing their jobs and their health benefits.
Second, the FMLA guarantees only unpaid leave, which means millions of workers who need leave cannot afford to take it. In fact, the share of workers who said they needed and did not take leave doubled from 2000 to 2012. The most common reason provided by workers who needed FMLA leave but did not take it was that they couldn't take time off without some income. Other workers took shorter leaves, dipped into savings earmarked for other needs, went into debt, or had to accept public assistance as a result of taking unpaid leave. n18
Recognizing the gaps, we looked beyond the FMLA to study whether the private sector or state laws better address workers' need for paid time off. A report we issued earlier this summer, Expecting Better: A State-by-State Analysis of Laws That Help New Parents, answered that question with a resounding "no" - the same conclusion we reached in 2005 and 2012 when we conducted similar analyses. n19
B. Employer Policies
Expecting Better reveals a nation in which chance and inequality reign. Whether a mom or dad - or a son, daughter, husband or wife - has access to paid leave is purely a function of who they work for and where they live. And, unfortunately, most people are left out.
Overall, just 12 percent of private sector workers nationwide have access to employer-provided paid family leave that they can use to bond with a new baby or care for a seriously ill family member. n20 Only 40 percent have access to employer-provided short-term disability insurance to address a personal serious medical need that requires time away from work. n21 And only about 61 percent have access to paid sick days, for when short-term illnesses strike. n22
Lower-wage workers are hit the hardest and face particular challenges when serious family and medical needs arise. Most workers in the bottom wage quartile (those who are paid
For the highest wage earners, the story is different, but even for them, access to paid family leave and short-term disability insurance is lacking. In addition, workplace cultures too often discourage people - especially men - from taking time away from their jobs to address family needs. n26
Table 1: Percentage of Prrivate Sector WWorkers with Access to Paidd Time Off
Focusing specificallyy on paid paarental leavee, only 50 peercent of neew moms takke paid leavve of any lengtth after the birth of theeir first childd, often cobbbling togethher accrued sick, vacatiion and persoonal time, aand that nummber hasn'tt changed apppreciably iin more thann a decade. n27 Among wwomen with lower levelss of educatioon, less thann one-fifth ttake any typpe of paid leeave around thhe birth of ttheir first chhild - the saame percenttage as in 19961. n28
The perceentage of emmployers offfering fully ppaid maternnity leave hhas actually declined quuite substantiially in receent years, drropping fromm 17 percennt in 2005 too nine perceent in 2014. n29 For men, it's no better. JJust nine percent work for employeers that offeer paid paternity leave to all of their employees. n30 The "all" here is imporrtant. Even within worrkplaces, emmployers maay offer matternity, pateernity or parrental leavee to some of their workeers but not to most or aall. n31
C. State Policiess on Paid Faamily and MMedical Leavve
Fortunately, some sttates are takking the leaad in addresssing the challenges faccing working families. Diverse coaalitions of addvocates, woorkers and bbusiness leaaders have won significcant policy chaanges, incluuding paid sick days, paaid family a and medical leave, and expanded FFMLA laws thatt cover moree workers thhan federal law. Those advances hhave establisshed basic protectionns for millioons of workiing families across the country andd, in turn, hhave paved tthe way for mmore state innnovation, sseeding the ground for this nationaal conversattion.
Most impportant for ttoday, some states havee created baasic paid fammily and meedical leave standards through sttatewide fammily leave iinsurance prrograms. Caalifornia's pprogram hassbeen in effect for a decade and wwas recentlyy expanded to give workkers the abiility to care for a wider rannge of seriouusly ill famiily memberss, including siblings, grrandparentss and grandchilldren. n32 Neww Jersey's pprogram hass been in efffect for five years and
The
D. International Comparisons
It is worth noting that
III. Greater Access to Paid Leave Would Create More Economic Opportunity for All
All of the available research - from employer-generated studies to analyses of
A. Paid Leave Promotes Greater Economic Security and Financial Independence for Working Families
Guaranteeing workers access to paid leave can improve families' economic security and promote financial independence in the face of major life events. Paid leave encourages workforce attachment. Mothers who take paid leave are more likely than mothers who do not to be working nine to 12 months after a child's birth. n41 They are also more likely to receive higher wages over time. In the year after the birth of a child, mothers who take paid leave are 54 percent more likely to report wage increases than mothers who do not and are 39 percent less likely to receive public assistance or food stamps, taking into account other socioeconomic and workplace factors that might explain these differences. When fathers take paid leave, they too are significantly less likely to receive public assistance or food stamps than fathers who do not. n42 These figures are particularly important in context: Having a baby is the most expensive health event that families face during their childbearing years, n43 and it is estimated that 13 percent of families with a new infant become poor within a month. n44
Family caregivers and workers with serious health conditions, too, are more likely to be able to stay and contribute in the workplace if they have workplace accommodations, such as paid leave. n45 And helping older workers stay employed has real implications for their retirement security: A woman who is 50 years of age or older who leaves the workforce to care for a parent will lose more than
B. Paid Leave Benefits Businesses
Whether employers offer paid leave to attract and retain workers or workers gain access to paid leave through a state paid leave insurance program, businesses experience cost-savings and other benefits when workers can take paid leave to address family and medical needs. First-time mothers who take paid maternity leave are more likely than mothers who do not to return to work - and to return to work for the same employer - after taking time to recover and care for their children. n49 Workers who are dealing with personal health issues or caring for a loved one are better able to stay employed when they have paid leave and other family friendly policies. n50
Retaining workers is cost-effective because of the high costs that employers shoulder as a result of employee turnover. Researchers recently surveyed 31 company and academic case studies that calculate direct and/or indirect turnover costs for a variety of occupations across industries and wage levels. For high-wage, high-skilled workers, including in fields like technology, accounting and law, turnover costs can amount to 213 percent of workers' salaries. n51 Across all occupations, median turnover costs are estimated to be 21 percent of workers' annual wages, and even in middle- and lower-wage jobs, turnover costs are estimated to be 16 to 20 percent of workers' annual wages. n52 Direct costs associated with turnover include separation costs, higher unemployment insurance, costs associated with temporary staffing, costs associated with searching for and interviewing new workers, and training costs for new workers; n53 indirect costs can arise from lost productivity leading up to and after employee separations, diminished output as new workers ramp up, reduced morale and lost institutional knowledge. n54
Studies from states with paid leave programs demonstrate the impact paid leave can have on retention, particularly among workers who were less likely to have paid leave before. In surveys conducted with
In addition, 90 percent or more of
helped reduce stress and improve morale among workers taking leave, as well as among their co-workers. n57
C.
When people have time to care for themselves and their loved ones without jeopardizing their ability to make ends meet and afford basic expenses, their health and well-being improves. Newborns whose mothers take at least 12 weeks of paid leave are more likely to be breastfed, receive medical checkups and get critical immunizations. n58 Neonatal mortality is reduced when parents have access to paid leave. n59 A recent review of international literature concludes that there are benefits for maternal health when fathers take paid leave, including a reduction in maternal illness and depression and an increase in well-being. n60
Paid leave has important benefits when family members are ill as well. When children are critically ill - whether at birth or later - the presence of a parent shortens a child's hospital stay by 31 percent. n62 Active parental involvement in a child's hospital care may head off future health care needs and reduce costs. n63 Similarly, family caregivers with paid leave who care for an elderly loved one are better able to help loved ones recover from illness, fulfill treatment plans, and avoid complications and hospital readmissions, which can help lower health care costs and improve health outcomes. n64 Family caregivers themselves are also better able to care for themselves when workplace policies anticipate and are responsive to their needs. n65
D. Paid Leave Impacts Government Revenues and Spending
Paid leave is a wise public investment. More people at work, earning higher wages, means more people paying taxes and contributing to
In short, all of the evidence reveals that paid leave leads to stronger families and a stronger nation.
IV. The Path Forward: Toward an America Where All Workers Have Access to Paid Family and Medical Leave
The big question is how we get from an America where just 12 percent of hardworking people have paid family and medical leave to one where all do, so that working women and men, whether they live in
A. Celebrate Paid Leave as a Win-Win for Businesses and Working Families; Create Resources for Employers
First, there are a growing number of leaders at businesses of all sizes, and across industries, who can discuss and provide data about the tremendous benefits that paid leave policies offer. There are also a number of organizations that study business practices. They promote the good examples that leading employers set and can provide tools to other employers that want to follow suit.
It is important to hear from employers who are already doing the right thing, like my co-panelists today, and many others. I'm thinking here of employers like
It is important to use meetings of business leaders, business publications and less formal business-to-business mentorships as vehicles to help allay concerns and answer questions about how employers can address business or management issues that arise when employees take family and medical leave - for example, best practices in cross-training employees, re-assigning work or hiring temporary replacements to pitch in while permanent employees deal with family or medical issues. Employers like Ernst & Young,
And we must also hear from families like Jeannine's, who can attest to the difference paid leave makes. Any of us who have been lucky enough to work for an employer that offers paid leave knows firsthand its impact.
B. Encourage More State Innovation
The state paid leave programs in
Federal programs can incentivize more state action. For example, the
C. Adopt a National Paid Leave Standard
Ultimately, the positive experiences of employers and states must pave the way for a national paid family and medical leave standard. We must replace today's patchwork of policies, in which people's family and medical leave experiences are dictated by chance and too often fraught with hardships or simply nonexistent. Our nation urgently needs a system that affords working families the financial stability they deserve, and helps employers to build workforces that are committed, happy and productive. When we do that, our nation will benefit from stronger families and a stronger economy, and we will be better able to compete in the 21st century and beyond.
An effective national paid family and medical leave solution must have, at minimum, the following attributes:
First, it must make paid family and medical leave available to all workers, regardless of their employer's size, and whether they work full-time, part-time or are self-employed. It must reflect an aspiration that is core to the American Dream, that people should have the freedom and mobility to be able to seek better opportunities for themselves and their families without worrying about losing key paid family and medical leave protections when they move jobs or relocate to a new state. And it must do so at a wage replacement level that lets families meet basic expenses.
Second, it must reflect all the well-established reasons people need family and medical leave, including for caring for a new child, a loved one with a serious health condition, a worker's own serious health condition and for certain military family caregiving purposes; it must provide leave for an adequate length of time; and it must apply equally to women and men. It should recognize the
Third, it must protect workers against retaliation for needing or taking leave.
Fourth, it must be affordable for workers, cost-effective for employers, and offer efficiencies with existing employer and state-based programs. Benefit levels can be capped at reasonable dollar amounts to avoid unduly high payments for higher-wage workers.
Others features are critical, but these are among the most important.
We at the
I hope this hearing and other conversations in
n1 The
n2 Glynn, S. J. (2014). Breadwinning Mothers, Then and Now.
n3 Laughlin, L. (2011, October). Maternity Leave and Employment Patterns of First-Time Mothers: 1961-2008. U.S. Census Bureau Publication. Retrieved
n4
n5 Eisler, R., & Otis, K. (2014). Unpaid and Undervalued Care Work Keeps Women on the Brink. In O. Morgan, &
n6 The
n7 Mishel, L., & Shierholz, H. (2013). A decade of flat wages: the key barrier to shared prosperity and a rising middle class. Economic Policy Institute Publication. Retrieved
n8 See note 1.
n9
n10 Ibid.; See also The
n11 Douthat, R. (2012,
n12 Ibid.; Friedman, S. D. (2013, October). Baby Bust: New Choices for Men and Women in Work and Family.
n13
n14
n15
n16 Klerman, J., Daley, K., & Pozniak, A. (2012,
n17
n18 See note 16.
n19
n20
n21
n22 See note 20.
n23 See notes 20 and 21.
n24 See table 1 in text below.
n25 Boushey, H. (2014). A Woman's Place Is in the Middle Class. In O. Morgan and
n26 Harrington B. et al. (2014). The New Dad: Take Your Leave. Perspectives on paternity leave from father, leading organizations, and global policies.
n27 See note 3..
n28 Ibid.
n29 Matos, K., && Galinsky, E. (20014). 2014 Nationnal Study of Emplloyers. Families a and Work Institutte Publication. Reetrieved 26 July 22014, from http://faamiliesandwork.oorg/downloads/22014NationalStuddyOfEmployers.ppdf; Galinsky, E., AAumann, K., & Boond, J. (2011, August). g 2008 Nationaal Study of the Chhanging Workforcce. Families and WWork Institute Puublication. Retrieeved 26 July 20144, from http://familie sandwork.org/sitte/research/repoorts/Times_Are_C hanging.pdf
n30 See note 166.
n31 Ibid.
n32 Cal. Unempp. Ins. Code [Subsec.] 33300-3306.
n33
n34 Haw. Rev. Stat. [Subsec.] 392-3, 392-21, 392-23, 392-25;
n35
n36 World Policy Analysis Center. (2014). Workplace policies before and after childbirth. World Policy Forum Publication. Retrieved
n37 Ibid.; Siegelshifer, V. (2010, July). A Need for Non-Transferable Paternity Leave in
n38
n39
n40
n41 Houser, L., & Vartanian, T. (2012, January). Pay Matters: The Positive Economic Impact of Paid Family Leave for Families, Businesses and the Public.
n42 Ibid.
n43
n44 Rynell, A. (2008, October). Causes of Poverty: Findings from
n45 Ryan, E. (2014,
n46 See note 15.
n47 Ibid.
n48 Himmelstein, D. U., Thorne, D.,
n49 Laughlin, L. (2011,
n50 See note 15.
n51 Boushey, H., & Glynn, S. (2012,
n52 Ibid.
n53 Allen, D. G., Bryant, P. C., & Vardaman,
n54 Hausknecht, J. P., & Holwerda, J. A. (2013). When does employee turnover matter? Dynamic member configurations, productive capacity, and collective performance. Organization Science, 24(1), 210-225; See also Note 50.
n55 Appelbaum, E., & Milkman, R. (2011). Leaves That Pay: Employer and Worker Experiences with Paid Family Leave in
n56 Ibid.
n57 Lerner, S., & Appelbaum, E. (2014, June). Business As Usual: New Jersey Employers' Experiences with
n58 Berger, L., Hill, J., & Waldfogel, J. (2005). Maternity Leave,
n59 Ruhm, C. J. (2000). Parental leave and child health.
n60 See note 26.
n61 See note 55.
n62 Heymann. J. (2001,
n63 Heymann, J., & Earle, A. (2010). Raising the global floor: dismantling the myth that we can't afford good working conditions for everyone.
n64 See e.g.,
n65
n66 Includes states with both paid family leave and temporary disability insurance (personal medical leave) programs. Houser, L., & Vartanian, T. (2012, April). Policy Matters: Public Policy, Paid Leave for New Parents, and Economic Security for
n67 Better Workplaces, Better Businesses (n.d.). Businesses Support the Family and Medical Insurance Leave Act. Retrieved
n68
n69
Read this original document at: http://www.help.senate.gov/imo/media/doc/Shabo.pdf
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