Proposed Federal Paid Family Leave Program Likely to Face Challenges

President Joe Biden recently proposed a $325 billion federal paid family and medical leave program as part of his $6.8 trillion budget plan for the fiscal year 2024. Despite the president’s push for extended family support and paid time off, the program’s passage faces uncertainty due to anticipated opposition from Republican lawmakers. Nonetheless, the proposal is expected to spark broader discussions about providing employees with paid leave.

Although the Family and Medical Leave Act (FMLA), passed in 1993, already allows unpaid, job-protected leave to most workers, the proposal would be an expansion of that program, and would allow workers to take up to 12 weeks of paid leave to bond with a new child, care for a family member, or recover from a severe illness. It would also provide up to three days of paid bereavement leave. Biden pointed out that the U.S. remains one of the few wealthy countries without a national paid leave policy. Some states and cities, however, have implemented their own family and medical leave laws.

Modernizing the Family and Medical Leave Act

The Society for Human Resource Management (SHRM) advocates modernizing the Family and Medical Leave Act to expand access to paid leave and provide employers with increased flexibility in program design. SHRM has also proposed a voluntary federal insurance market, allowing employers to fund paid leave benefits through pooled resources, reducing employer risk while granting employees access to paid leave.

Recent SHRM data reveals that in 2022, only 33% of employers offered paid parental leave, down from 39% in 2020. Additionally, 31% of employers provided paid leave for employees to care for an immediate family member.

Implementation of the proposed federal paid family leave program faces significant challenges due to expected Republican resistance to Biden’s federal budget plan. However, the proposal may still prompt meaningful conversations and drive concerted efforts to address paid leave issues at both state and federal levels.

DOL to increase audits 

The U.S. Department of  Labor (DOL) announced in February that it would be ramping up audits on employers.

While the DOL made it clear that one of its priorities is to verify compliance with the Family and Medical Leave Act, this increase in audit frequency will also apply to wage and hour audits.

The DOL also announced that it would be expanding its Wage and Hour Division with 100 new investigators. This lends further credence to the idea that the DOL will be moving forward with its intentions and audits will become more frequent.

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This is not intended to be exhaustive nor should any discussion or opinions be construed as legal advice. Readers should contact legal counsel or an insurance professional for appropriate advice.