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Paid family leave boosters eye expansion to program

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As New Jersey nears the fifth anniversary of its family leave insurance law, a report released today by Rutgers University's Center for Women and Work recommended measures to expand the program's effectiveness and workers' use of its benefits.

Under the Family Leave Insurance provision of the state Temporary Disability Benefits Law, workers can be paid up to two-thirds of their wages — to a maximum of $572 per week — for as long as six weeks for pregnancy, to bond with newborns or to care for sick family members. The program is funded through a tax paid by employees.

On a conference call about the report today, Karen White, director of the center’s Working Families Program, said over the last three years of the law’s implementation, the slight increase in the average weekly benefit in dollars — from $471 in 2009 to $482 in 2011 — has not kept pace with inflation. She recommended a hike in the level of wage replacement in order to make leave more affordable for eligible workers.

“Despite the program’s overall success, there remain challenges for workers in accessing the benefits the program provides,” White said on the call. “New Jersey took a small step with family leave, and with a few small changes it can do even more.”

Business groups sharply criticized the law when it was signed in May 2008, but looking back on the last five years, Employers Association of New Jersey President John Sarno — an early supporter of the law — said “it’s clear that the rhetoric that this law would be a ‘nail in the coffin’ for New Jersey’s businesses is totally overblown.”

“Employers’ fear is generated from misinformation. It’s not a leave law, it’s a wage insurance, and we look at it as another part of the routine administrative mix for employers,” Sarno said. “It’s meeting its intended purpose, though it seems to be underutilized, which is pretty much what our view was going in.”

While the state Department of Labor and Workforce Development has approved more than 100,000 claims for the partial wage replacement benefit since July 2009, an August 2012 Rutgers-Eagleton poll found roughly 60 percent of the 900 registered voters surveyed had not “seen or heard anything about” family leave insurance. Additionally, while nearly one in five respondents indicated they had taken temporary leave between July 2009 and August 2012, fewer than half had received pay or compensation during that time, according to the poll.

In response, state Sen. Barbara Buono (D-Edison) pushed a bill through the Senate Labor committee in October to require employers to proactively inform workers about their rights under the law, as well as oblige health care providers and medical institutions to explain the program to patients with conditions that would likely entitle them to take paid temporary family leave.

But the New Jersey Business & Industry Association called the proposal “information overload,” as the group argued the additional requirements would be burdensome for businesses.

“We are never opposed to employees understanding their rights, but the notification process is cumbersome for employees and employers alike, as they’re subject to 15 separate state and federal notice requirements — which doesn’t count the four notices already required under state law that this bill addresses,” Stefanie Riehl, NJBIA assistant vice president, said in testimony at the Senate committee hearing.

However, Sarno noted the law’s underuse stems from the fact that businesses with less than 50 employees — which comprise a majority of companies here — are not caught in its web, so “the legislators and the lobbyists are talking about oranges, and the bill is an apple.”

“The reason why (the law is) underutilized is not from a lack of awareness, it’s because if you have less than 50 employees, then it’s not mandatory,” Sarno said. “They’re all fighting the wrong battle.”

On Oct. 1, Buono’s bill was referred to the Senate Budget and Appropriations Committee, where it still awaits a vote. An Assembly version of the bill was introduced by Assemblywoman Connie Wagner (D-Paramus) on Oct. 15, but it also awaits a vote by the Assembly Labor Committee.

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Write to the Editorial Department at editorial@njbiz.com

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