Paid family leave will generate mixed reception among NM business owners

SANTA FE – A plan to add New Mexico to the list of states that allow state-administered family leave to allow workers to take paid time off for maternity, sickness and injury is facing uproar in the Roundhouse, with opposition from some businesses and a new legislative analysis suggesting the program could be more expensive to administer than previously estimated. .

But supporters are pushing back, with Senate President Pro Tem Mimi Stewart, D-Albuquerque, questioning legal analysts and suggesting that supporters make adjustments to the bill to address business concerns.

“We worked on the bill for two years,” Stewart told the Journal. We have many businesses that support this.

Her supporters also learned from the experience of other states with paid family leave programs, such as Washington, which had to double its labor and business levies to ensure the funding was efficient.

Since the filing, Senate Bill 11, the Paid Family Leave Act, has passed one Senate committee and is awaiting a hearing in the Senate Finance Committee.

With the 60-day session now more than halfway through, Stewart said she plans to speak with committee chairman Sen. Jorge Munoz, D-Gallup, about getting the proposal on the panel’s agenda.

Local business owners have mixed views on the Roundhouse’s new push, which comes a year after New Mexico enacted paid sick leave for nongovernmental employers.

Dale Esparza, founder of Esparza Digital and Advertising, said his company previously offered benefits packages that included up to four weeks of parental leave for a primary caregiver or up to two weeks for a non-primary caregiver.

He said such leave is important for employees’ mental and physical health and performance at work, but said the paid family leave law could hurt a small business like his with 16 employees.

The proposed law “will hurt small businesses,” Esperza said. “Being able to take three months off is a problem.”

However, other business executives, such as Mackenzie Enriquez, CEO of Albuquerque-based Monstly LLC, which deals mostly with union governance in health care, support the law as it stands.

“It creates a really good work environment,” Enriquez said. “People put a lot of stress on it and it’s a big thing to have the benefit of knowing, ‘OK, this is covered and I can turn this time off if necessary. … Honestly, I think it’s a great idea.

Is there a deficit in 2028?

This year’s proposal, officially called the Paid Family and Medical Leave Act, is based on input from a task force of advocacy groups, business owners and union representatives that met last summer and issued a final report in October.

It requires both employers and employees to start making regular payments to the state fund by 2025, although businesses with fewer than five employees are exempt. That fund will be used to compensate workers who are eligible for paid leave starting in 2026.

In a new Legislative Finance Committee analysis of the plan, a task force that studied the issue estimated how many people would file to take paid family leave under the proposed law, because both parents of a newborn could be eligible for up to 12 weeks. Paid vacation time.

Specifically, Bill’s analysis predicts the fund could face a $516 million deficit in fiscal year 2028 — a scary figure that could cause the state’s Department of Workforce Solutions to increase the amount of premiums businesses and workers pay into the fund.

Opponents of the proposal were quick to seize on the analysis, with Terry Cole of the Greater Albuquerque Chamber of Commerce saying the bill would impose a “huge tax” on workers and employers.

But supporters of the bill argued that the analysis was based on a U.S. Labor Department survey of the federal Family and Medical Leave Act — which requires employers to provide up to 12 weeks of unpaid leave under certain circumstances — and not other states. Experiences with paid family leave laws.

The amount of the proposed contribution in the state fund “really should be more,” said Stewart, who argued in a legislative analysis that 10% of eligible workers apply for paid leave in one year.

“People want it now,” said Stewart, who noted that the United States is one of the only countries that does not offer paid family leave. “People need to take time off to take care of others and themselves.”

In the most recent five-year period, only 53.2 percent of New Mexico women age 16 and older were employed, she said, adding that paid family leave would especially benefit low-income workers and women.

Opt in and opt out

It’s unclear exactly how many of New Mexico’s approximately 44,000 businesses with more than one employee offer paid family leave.

But the list of employers offering such a license includes the University of New Mexico, Netflix and the state of New Mexico, according to a 2019 executive order by Gov. Michelle Lujan Grisham.

Zoe Otero-Martinez, executive director of Family Friendly New Mexico, an organization that helps businesses implement workplace guidelines, described family-friendly policies as general good business practice.

“We know that paid leave can be embraced by employers of all sizes and industries,” she told the Journal.

Under a proposal pending at the Roundhouse, businesses that offer paid family leave could opt out of the state program as long as they meet minimum requirements.

But they can also opt in, and Stewart predicts some businesses will find the state-run program attractive because they don’t have to directly pay employees for time off.

A common theme among the bill’s critics, however, is that the timing of the paid family leave mandate is ill-timed, with many businesses still feeling the aftershocks of the Covid-19 pandemic.

Dreamtile Improvements President and CEO Larry Chavez said they advocate for the health and safety of their employees while providing paid vacation and paid sick leave in accordance with state law.

But Chavez, whose company employs about 225 full-time workers in New Mexico and 900 in a handful of other states, said lawmakers need to consider the costs associated with state mandates.

“It’s important that we’re attractive to new businesses or businesses started by local residents,” he said. “We want to be competitive.”