There are two parts to the proposal on family and medical leave that produce the most opposition from critics: that the program be mandatory and that it be run by the state.
Proposals so far have had a mix: Democratic lawmakers favor a mandatory state-run program. Others, like Pinnacol Assurance, are on board with mandatory but believe a private-run program would be preferable.
A proposal authored by Rep. Lois Landgraf, R-Colorado Springs, would do neither.
Landgraf held a meeting with potential stakeholders for her proposal this week. It’s modeled after three different federal laws:
- The Working Parents Flexibility Act of 2019
- Tax Cuts and Jobs Act
- The Working Families Flexibility Act
Landgraf told potential stakeholders that making a family and medical leave program mandatory removes it as an incentive for businesses struggling to find workers in this tight labor market.
Her proposal, which is still in discussion stages, would grant up to 12 weeks of paid family or medical leave per year.
It works like this: an employee can contribute up to a maximum of $6,750 per year to a leave savings account and could do so as a pre-tax deduction. Employers who contribute to that employee’s account would earn a tax credit of 25% of their contribution, or receive a 25% tax credit if they pay at least 50% of that employee’s wages while they’re on leave.
An account cannot exceed $24,000, and the account stays with the employee when they move to another job. However, the employer contribution does not stay in that account if the employee leaves.
Another facet of Landgraf’s proposal would allow hourly wage earners who make $23,660 per year or less to choose between being paid time-and-a-half for overtime or take it as time off, including as family leave.
The proposal also allowed an employee, who is nearing the end of anticipated family leave needs, to make a one-time transfer of any remaining funds in the leave account to a qualified 529 account.
The proposal follows other leave scenarios, such as being used for personal illness, caring for an ill family member, birth or adoption of a child, foster care parenting, for support of victims of domestic abuse or for a family member of military personnel.
The leave account can pay for wage replacement or outstanding medical expenses, the proposal states. Employers would be required to maintain the position for the full duration of the employee’s leave.
Landgraf ran a similar bill in the 2019 session but with some important distinctions. The 2019 measure said the account would be set up with a financial institution; Landgraf has said she wants a free market proposal but has not said how it would be administered. She also had a proposal at the ready in the 2018 session, even with support from Rep. Jeni Arndt, D-Fort Collins, but that bill was never introduced.
Landgraf said she is hopeful that the proposal will win favor from Gov. Jared Polis, who has weighed in on the side of the private market on a family leave program. Last fall, he told a task force charged with coming up with a recommendation for 2020 legislation that employers above a certain size should “provide a defined minimum paid-leave benefit to employees, which an employer could choose to administer either by itself or through insurance provided through the private market.”