In his address to a joint session of Congress on Wednesday, President Joe Biden laid out his plan for providing workers with up to 12 weeks of paid family and medical leave per year. President Biden based the proposal on economic factors, noting that the U.S. has fallen behind other developed nations in its support of workers, and that the failure to provide a paid leave benefit forces a significant number of them out of the workforce.
The proposal starts with providing paid leave of between two-thirds and 80% of wages depending on the employee’s income, up to a maximum of $4,000 per month. While the measure would allow paid leave for reasons currently covered as unpaid under the Family and Medical Leave Act (including military dependent leave), it adds additional qualifying criteria, including escaping a stalking or domestic violence situation. It also adds three days of bereavement leave per year following the death of a loved one.
The full paid leave benefits would be phased in over a 10-year period, with an estimated cost of $225 billion over the first decade of the program. The leave would be funded through general tax revenues, and not by any new payroll tax measure imposed on employers or employees. While the Trump administration also considered introducing a paid leave benefit, passage of this new proposal is by no means certain. Employers should monitor the progress of this proposal in order to plan for any eventual changes in their leave policies.
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