CT paid family leave plan moves forward
HARTFORD — Gov. Ned Lamont told business leaders Wednesday that paid Family Medical Leave was going to pass, and on Thursday the Labor and Public Employees Committee forwarded his bill to the Senate.
With little fanfare or debate, the Labor and Public Employees Committee voted along party lines to approve the measure, which creates a paid FMLA program for an estimated 103,600 employers with approximately 1,456,000 employees.
Under the legislation, all employees in Connecticut would contribute 0.5 percent of their weekly paycheck to a state-run trust fund, which would pay them during their approved leave. The governor’s bill says an employee could earn 90 percent of their typical earnings up to $600 per week for anyone making around $15 an hour and 67 percent up to $900 for workers earning more than that.
The other two pieces of legislation offer a wage replacement level of 100 percent, up to a maximum of $1,000, which is much higher than programs in other states.
“The program is an unsustainable program,” Rep. David Rutigliano, R-Trumbull, said.
He said he thinks it’s going to cost much more than originally proposed and employees are going to be on the hook for making up the difference through what essentially amounts to a payroll tax.
The Office of Fiscal Analysis estimated that for the other two pieces of legislation, which were approved earlier this month by the committee, the state would be required to borrow $20 million — $10 million in 2021 and $10 million in 2022 — to get the program started. The total cost of those bonds would be about $30 million by the time they are repaid at a rate of about $500,000 per year.
The ongoing administrative costs of the trust fund will be about $18.6 million, according to the fiscal note, and will be covered by employee contributions to the trust fund.
The program would apply to every business in the state with at least one employee. Those who are self-employed could decide to pay into the program if they chose to opt in.
Sen. Julie Kushner, D-Danbury, said she believes strongly that the program will benefit Connecticut and its economy.
But the business community is divided.
At the Connecticut Business and Industry Association meeting Wednesday, Mark Stewart Greenstein, a West Hartford businessman who also ran for governor last year, said he might be able to support it if it wasn’t a 90 percent wage replacement rate.
“Ninety-percent guarantees those workers are going to take 12 weeks off every year,” he said.
He suggested a lower wage replacement rate of maybe 60 percent.
The weekly benefit in Massachusetts is 80 percent of salary, capped at $850 per week.
Lamont told a group of about 300 business executives that any program has to be “rock solid” in how it will be financed.