Letter to the Editor on Paid Family Leave

Joan Verplanck, President, NJ Chamber of Commerce

Since the workers of New Jersey will be picking up the tab for the state’s proposed paid leave program, they should know that legislators may be basing their vote on statistics that aren’t realistic. This miscalculation will force every worker in NJ to pay higher taxes. Why is that?

The Department of Labor has estimated that 38,000 people will use paid leave in the first year, based on California numbers. It would make more sense to calculate the use rate based on New Jersey data. On average, 29,000 women (not dads, not adoptive parents) receive maternity leave benefits under our current temporary disability insurance coverage. Those not covered by TDI benefits and who probably account for a sizeable number of women who actually gave birth (114,000) versus those who took the benefit will be eligible for paid leave. If even half of these people take the benefit, the usage swells considerably to 57,000 – 28,000 more than now get benefits, 19,000 more than anticipated by the state.

The new paid leave bill extends beyond our tradition of supporting mothers to include dads, adoptive parents, caregivers for immediate family members, and possibly even folks who are sick and have exhausted other benefits.

Cost to workers is estimated at $33 per year based on 38,000 people using the benefit. However, the actual amount could be closer to $250 per year if, once expanded, the use rate comes closer to the private sector experience of 8%. This is quite a difference considering how important every dollar in your paycheck is these days. With a recession looming, why would we even consider taking more money out of people’s paychecks?

Paid leave is one of those things that sounds good in theory but can be a nightmare in practice. Who will pick up the slack for those off on leave? We’re in competition with the world, and it’s getting more and more difficult for companies to survive. Most New Jerseyans understand that employers do whatever they can to keep quality workers. Small companies operate like extended families, adjusting to individual circumstances, and many large companies already provide leave. The best and most durable support we can give a family is a good paying job. Anything that threatens that, no matter how good it sounds, is suspect.

Let your legislator know that profits equal paychecks, and you want your paycheck to be left alone.

March 2008