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The City of Washington, D.C., has recently reformed and expanded substantially its paid leave law. Under the new Universal Paid Leave Act, private-sector employees in Washington will have up to eight weeks of paid leave for the birth, adoption, foster care, or assumed legal guardianship of a child. Employees in the private sector will also be entitled to up to six weeks of paid leave to care for a sick relative and two weeks of paid leave when they are themselves ill. Employees need not reside in the District in order to qualify for the benefits – Universal Paid Leave Act benefits are determined by where a person is employed, not by where he or she lives.

The Council of the District of Columbia approved the Universal Paid Leave Act late in December 2016 by a 9-4 vote, so after a 30-day period for Congressional review, the new law should take effect early in 2017. One of the nation’s most generous paid family leave programs, the Universal Paid Leave Act will be funded by applying a 0.62 percent tax rate to employer payrolls. The maximum weekly benefit per employee will be $1,000. Federal and city employees are not eligible for the benefits.

Since 2008, Washington has required private-sector employers to give employees, depending on the size of the employer, six to eight paid sick leave days every year. Washington was the second city in the United States to pass its own paid sick leave law – a similar proposal was adopted in San Francisco in 2007. San Francisco also expanded paid leave for that city’s private sector employees in 2016, and that city’s new Paid Parental Leave Ordinance also goes into effect this year.

WHY ARE CITIES PASSING PAID LEAVE LAWS?

The nationwide move for more mandatory paid leave has gained substantial momentum in the last several years. With no federal law or Congressional action requiring employers to provide paid sick leave, states and cities have taken the lead by crafting and enforcing their own sick leave laws. Family Values @ Work, a Milwaukee-based non-profit group that advocates for family and employee rights, says that forty jurisdictions across the U.S. have now implemented paid sick leave. Seven states now have sick leave laws in effect or going into effect this year, along with cities that include Washington, San Francisco, Philadelphia, San Diego, and Seattle.

Employers in D.C. may not interfere with or deny the exercise of an employee’s rights under the Universal Paid Leave Act. By law, employers cannot terminate or threaten to terminate or otherwise retaliate against an employee for exercising his or her leave rights under the Universal Paid Leave Act. If you are an employer in D.C. with any questions or concerns about the Universal Paid Leave Act, have an experienced Washington, D.C. business lawyer answer those questions and address those concerns for you.

Although the Universal Paid Leave Act had widespread support throughout the District, it was surrounded by controversy as well, and proposals for funding the Act were at the center of that controversy. Prior to the vote on December 20th, Ward 5 council member Kenyan McDuffie told his colleagues on the council, “What’s not lost on me is what that cost might be to those businesses.”

HOW MUCH OF THE PAID LEAVE BENEFITS WILL LEAVE THE DISTRICT?

And although taxing Washington’s businesses by 0.62 percent will bring $250 million into the city, most of those resources – $166 million – will in fact leave the District of Columbia with private sector employees who actually reside in Maryland or Virginia. Ward 2 council member Jack Evans voted against the Universal Paid Leave Act, saying, “To take government money and disperse it to Virginia and Maryland with only $80 million going to our residents is appalling.”

With Ward 3 council member Mary Cheh, Evans co-sponsored an amendment – which failed – that would have provided alternative funding for the Act. Mayor Muriel Bowser released this statement: “I predict the Council will need to revisit this legislation and address the detrimental impacts on District residents and small businesses. I will not add my name to this legislation.” Additionally, the mayor strongly objected to $166 million in tax revenue leaving Washington. She said, “It is wrong to raise District taxes to fund a costly, new government program that sends 66 percent of the benefits outside of the city, and leaves District families behind,” she said.

A December editorial in the Washington Post also criticized the Universal Paid Leave Act, calling it “a half-baked scheme” to provide paid leave. The editorial charged that the Act was “developed haphazardly and is irresponsible,” adding, “The council pointedly refused to undertake a careful or studied approach. Instead, it listened to advocates whose interest was in claiming bragging rights for establishing the country’s most generous program.”

An earlier Post editorial in October was even harsher in its condemnation of the Universal Paid Leave Act and the efforts to make it law in the District: “Considering that the city is talking about spending $300 million to $400 million annually and establishing a whole new government bureaucracy to administer the program, one would hope to see some transparency, collaboration and thoughtful deliberation.”

HOW DOES MANDATORY PAID LEAVE IMPACT SMALL BUSINESSES?

Jack Mozloom is a spokesman for the National Federation of Independent Business, which opposes mandatory paid leave laws. He says that even with funding through payroll taxes, mandatory paid leave laws burden small businesses with the cost of overtime or temp workers to cover for absent employees. Here in the District of Columbia, business owners can obtain the legal advice they need – regarding the Universal Paid Leave Act or any other legal concerns – by consulting with an experienced Washington, D.C. business lawyer. Business owners outside of the District should know that mandatory paid leave has been making headway and gaining support across the country.

At the federal level, only unpaid family leave is required by law. Congress passed the Family and Medical Leave Act (FMLA) back in 1993. It allows employees to take up to twelve weeks’ leave without losing their jobs if they or their close family members become ill, or when a child arrives. But leave under the FMLA is unpaid, so many workers cannot take advantage of it. Additionally, the FMLA exempts only employers with fewer than fifty employees, so it covers only about sixty percent of the workers in the United States.

Posted in: Employment Law