The Association of Washington Business (AWB) urged the Legislature to allow employers to work out creative solutions to family leave without legislative intervention. That request was made when AWBs general counsel Kris Tefft testified opposing HB 1173 and SB 5069, the paid family leave bill at House and earlier this week.
While AWB lauds the good intentions of these companion bills, we feel there are too many flaws to make this family leave insurance program viable, Tefft said. If these bills were to pass, the cost involved in this program would endanger the business climate and disproportionately effect small businesses.
HB 1173 and SB 5069 would establish a paid family leave insurance program, imposing a two-cent per employee per hour payroll tax on all employers, of which one-half could be recouped from the employee, as a premium for family leave insurance. The insurance benefit is for five weeks of income supplementation while taking family leave. HB 1173 and SB 5069 create a series of leave requirements in addition to existing state and federal leave law.
Creating a good family leave bill is very noble undertaking, and as I travel around the state meeting with our members, we find that many have very creative ways to work with their employees when family leave is needed, said Don Brunell, president of the AWB. With nearly a $2 billion budget shortfall and the economy starting to get back on track, we do not need another regressive business tax and another burdensome layer of government bureaucracy to make this work.
– Hurts Small Business: The two companion bills disproportionately hurt small Washington businesses because it covers all employers, no matter how small. The state and federal family leave act exempts small employers for a reason; our small companies cannot afford to lose a large percentage of their workforce for up to five weeks because such cost might put them out of business.
– Direct and Indirect Costs: There is no evidence that the proposed two cents per employee per hour is sufficient to sustain the solvency of the program. These bills also do not account for extra over time of other employees who will be asked to do more to make up for lost workers productivity.
Washington state is already the sixth costliest state in the nation in which to do business. The addition of this bill will add more cost for doing business in Washington state.
