Md. Democrats again to push for 12-week paid leave program

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ANNAPOLIS — Democratic lawmakers say they will push again for a paid family leave plan that offers 12 weeks of leave to the vast majority of Maryland workers and would be funded by a new payroll tax.

The bill, expected to be introduced later this week, calls for the creation of a state-run insurance program that would provide paid leave for employees who need to care for a family member. Opponents say the proposal would create a new burden on small businesses.

“This is real life and we all go through things,” said Sen. Antonio Hayes, D-Baltimore city and sponsor of a Senate version of the bill that would create the new leave program. “This legislation does not invent a new category of leave. It just creates a funding mechanism for partial wage replacement  to allow people to make ends meet for up to 12 weeks.”

New tax argued

Opponents of the bill said it creates a new tax and a burden on small businesses already reeling from the passage of mandatory sick day legislation as well as the phase-in of a new $15 per hour minimum wage.

“That’s the layering effect you always hear about from small business owners,” said Michael O’Halloran, Maryland state director of the National Federation of Independent Businesses. “The bill ignores whether or not small businesses can afford to do such a program.”

A copy of this year’s bill was not available Tuesday, but sponsors said it will be similar to legislation proposed last year and offer leave to employees to care for a sick relative, a new baby or adopted child.

“We all need one another and we all need to be there for our families,” said Del. Kris Valderrama, D-Prince George’s, and a sponsor of the House version of the bill.

A similar bill introduced in 2019 proposed the creation of a state family leave insurance fund. Companies that have at least one employee earning $5,200 annually would be required to buy into the insurance fund paid for by a payroll tax split between the employer and employee. That tax would be capped at .5%, according to Del. Ariana Kelly, D-Montgomery, and a sponsor of the bill.

Some states exempt small businesses with fewer than 25 employees. Other states require employees to pick up two-thirds of the split on the payroll tax. For employees earning $50,000 annually, the cost per week would be less than $4.50 per week.

Startup costs

The state would also incur a cost for starting up the program, estimated last year to be about $80 million over four years. Additionally, the state would have to hire 400 employees at a cost of $27 million annually to administer the program, according to the same 2019 analysis.

Employees who qualify for the leave of up to 12 weeks would be eligible for a weekly benefit of $50 to $1,000 based on earnings.

California, New Jersey, and Rhode Island currently have similar programs. Massachusetts, New York, Washington and the District of Columbia have passed laws creating the programs but have not yet started paying benefits.

Kelly said the program could help business as well as employees.

“It solves a problem we have with our economy,” she said.

O’Halloran disagreed.

“At the end of the day this is a benefit, a benefit that under normal circumstances, small business owners would use to try to attract qualified applicants,” O’Halloran said. “Employers are hurting to try and find qualified employees and they use different benefits packages to try and attract qualified applicants because it’s a job seeker’s market.”