Paid Family Leave: Promoting Economic Stability for Children and Families

The opportunity to take leave from work when needed is of crucial importance to working families. Most people, regardless of gender or whether they have children, need to take time off from work for medical, family or other personal reasons at some point during their careers. Any family could face a serious injury or illness and need time off to focus on medical needs – and should be able to do so without fear of losing their jobs. Women who give birth require time off from work for both the birth and recovery – and regardless of whether they have given birth, parents also naturally wish to take time to bond with a new child. According to the Center on the Developing Child at Harvard University, bonding with caregivers is crucial for children’s health and well-being and has lifelong effects on their physical and mental health.

The federal Family and Medical Leave Act (FMLA) enables workers to take up to 12 weeks of unpaid, job-protected leave for serious illness, a sick family member, or to bond with a new child. However, according to the Center for Law and Social Policy, about 40% of workers are not eligible for leave under FMLA. Such workers are at risk of losing their jobs when they need to take time off for medical or family reasons. Even when workers are eligible, the law is often underutilized because many workers can’t afford to take time off without pay.

Many low-income workers have two or more part-time jobs to make ends meet. However, part-time employees generally do not receive benefits such as health insurance or paid leave, so the workers who can least afford a loss of income are the least likely to have paid family leave or even paid sick days. Many low-income workers lose all income while on leave. Millions of workers who need leave for medical or family reasons either struggle to make ends meet while on leave or are unable to take leave at all because they can’t afford the loss of income.

Blacks and Latinos are disproportionately affected by lack of access to paid sick days or family leave. According to a report by the Center for American Progress, Black and Latino workers are significantly less likely than white or Asian workers to get paid sick days or paid family leave. A Latino worker is almost half as likely as a white worker to receive paid family leave.  Latino workers are also less likely to receive paid vacation days, a benefit provided to over 60% of Asian, Black and white workers.

This summer, Rhode Island became the fourth state to pass a paid family leave law. The Temporary Caregiver Insurance Bill (H.B. 5889, S.B. 231) expands the state’s Temporary Disability Insurance benefits to workers who need to take time out of work to care for a family member or bond with a newborn or newly-adopted child. The expanded benefits will be funded through additional employee contributions of approximately 0.075% of their income to TDI. For a worker earning about $40,000 a year, this would mean he or she would pay 64 cents a week to participate in the expanded benefit. 

California was the first state to pass a paid family leave policy. An evaluation found that most employers report that paid family leave had either a “positive effect” or “no noticeable effect” on productivity (89 percent), profitability/performance (91 percent), turnover (96 percent), and employee morale (99 percent).  The evaluation also found that abuse of the policy by employees was rare. Low-income workers who utilized the paid family leave policy had much higher levels of wage replacement during their leaves and were more satisfied with the length of their leaves than low-income workers who did not use the benefit. In addition, female workers who were breastfeeding that used paid family leave also breastfed their babies for twice as many weeks on average as those who did not use paid family leave. According to the Center for Law and Social Policy, paid family leave is a crucial support for breastfeeding mothers. The United States’ Surgeon General has stated that “[o]ne of the most highly effective preventive measures a mother can take to protect the health of her infant and herself is to breastfeed”.

New Jersey has enacted a similar policy, which has allowed over 80,000 workers to take family leaves averaging 5. 2 weeks with partial wage replacement. As in Rhode Island, paid family leave insurance policies are funded by worker contributions—much like unemployment insurance—amounting to less than one-half of one percent of wages. The Washington State legislature passed a paid family leave law in 2007, but the benefits have not gone into effect yet; a bill signed into law in July 2013 will further delay the implementation of the law until the legislature appropriates specific funding and sets a new implementation date.

State policymakers can consider the supports currently available to workers in their state who need to take time off from work for family or medical reasons. They can also strengthen other key supports for working families such as child care assistance and paid sick leave policies.

Please visit PolicyforResults.org for more information about how policymakers can ensure that children grow up in safe, supportive and economically successful families. To learn more about policies that support children’s healthy development through providing support to their families sign-up for Policy for Results updates and look for our new report – Supporting Early Healthy Development- Coming Soon!