A Look At The Policy Options To Help Working Families Get Ahead
Most of us have heard this before, but it still hurts: The United States is the only developed country in the world that does not offer paid family leave. However, that means there are other countries, along with some domestic examples, for federal policymakers to look at to create effective paid leave policy, as detailed in a new report by the Center for American Progress.
An effective family leave policy represents real family values by ensuring that that all parents and caregivers can be there for their loved ones without fearing job loss or poverty. Though there are several policy options to establish universal paid family and medical leave (PFML), it is critical that the paid leave policy follow several fundamentals in order to meet the needs of the current American workforce. A national paid family and medical leave program should be developed with the goals of supporting women’s labor force attachment, promoting gender equity, and reducing inequality. Therefore, in order to be truly effective, a national PFML program must be universal, accessible, comprehensive, affordable, and inclusive. Consistent with this framework, CAP released a report this week outlining three policy options, based on a series of international and domestic examples, to establish universal paid family and medical leave:
- Employer requirement programs, in which businesses are responsible for providing paid leave. Under this model, employers are required to provide paid leave to their workers and must finance the leave themselves. International experience with narrower programs providing maternity leave, however, shows that simply requiring employers to provide paid leave without robust workplace protections can lead to negative outcomes for working women.
- Social insurance programs, in which risk and resources are pooled to provide a fund for wage replacement during leave. The most common paid leave program structure, social insurance functions similar to private insurance plans, with individual premiums paid into a fund from which wage replacement can later be drawn. One option for a national PFML social insurance system was originally proposed and developed by the Center for American Progress and has been introduced in Congress as the Family and Medical Insurance Leave, or FAMILY, Act.
- Publicly funded programs, in which government resources are utilized to provide workers with paid leave. Under this model, which is used in Australia, the government still controls and administers the paid leave program similar to a social insurance model, but it is funded through alternate revenue sources rather than dedicated premiums contributed by or on behalf of individual workers.
The lack of guaranteed paid leave is a huge problem for American workers. Currently only 12 percent of all private-sector workers have access to paid family leave through their employer and low-wage workers are 5 times less likely to have paid family leave than high-wage workers. As a result, many workers are forced to choose between their paycheck, or in some cases even the security of their jobs, and caring for a family member. Women particularly feel the burden of the lack of paid leave, as they often take on much of the caregiving responsibilities. Indeed, the lack of paid leave affects women’s labor force participation, which has been falling in the United States relative to other advanced economies. Research shows paid family leave keeps people in the labor force and can even expand labor force participation. Many businesses know this is true: in the absence of legislative action, companies like Johnson & Johnson, Google, and, as of yesterday, Spotify have taken action to provide paid family leave to their employees.
BOTTOM LINE: Paid family leave demonstrates a real commitment to supporting working families. Workers and families deserve guaranteed paid medical and family leave so they won’t lose their paycheck if they take time off to care for a loved one or have a child. America shouldn’t have to play catch up to the rest of the world, but right now we are. It’s time for federal policymakers to update our workplace policies to help American women and families.
The positions of American Progress, and our policy experts, are independent, and the findings and conclusions presented are those of American Progress alone. A full list of supporters is available here. American Progress would like to acknowledge the many generous supporters who make our work possible.