Watch out, everyone. Paid Leave Armageddon could be just a few weeks away.
On July 1, the state is supposed to start collecting assessments for a massive new paid family and medical leave program. But companies have so many unanswered questions, their trade groups warn of a looming HR disaster.
They have been asking for a three-month delay. And state officials might still put one in place before time runs out, to give everybody the time they need to get ready.
That’s the theory, anyway.
The business lobbyists strengthened their hand by bringing their former antagonists at Raise Up Massachusetts, a coalition of labor and community activists that pushed for the new benefits, on board with a delay in May.
The frenemies then sent a letter together to Governor Charlie Baker, Senate President Karen Spilka, and House Speaker Bob DeLeo, pleading for the postponement.
Raise Up originally pushed this legislation, and wants to avoid a botched rollout.
On Monday, Baker said that lawmakers would probably need to act this week on the delay. But Thursday came and went, with no legislation to that effect appearing. You can’t blame the folks at Associated Industries of Massachusetts and the Greater Boston Chamber of Commerce for starting to sweat. Lawmakers and lobbyists alike remained unsure how this saga was going to end.
To quote the great philosopher Yogi Berra, it ain’t over till it’s over.
Encouraging signs began to emerge from the Big Three as Thursday wore on. Baker issued a statement in the afternoon saying his administration supports a three-month delay. Employers, he said, need significant lead time to adjust their payroll operations.
Spilka added that she is hopeful the discussions with DeLeo and Baker can result in the three-month postponement.
DeLeo then issued a statement making it clear that he “has not closed the door” on a delay. He said his office has sought additional information from the administration — particularly about a proposed increase in the assessment to fund the benefits.
About that assessment: To pay for the program, the state will collect a new payroll tax equal to 0.63 percent of employee wages. (That translates to about $400 a year for someone earning an average salary of $64,000.) Businesses and workers would share in the costs.
The bennies don’t start to kick in until Jan. 1, 2021. If the state has three fewer months of collecting assessments, the forgone money would have to come from somewhere — from, say, an increase in the assessment to 0.75 percent.
That’s one reason this issue has turned into a bit of a political hot potato. (The rates could be adjusted over time, anyway, starting in the fall of 2021.)
So why the delay? Carolyn Ryan, a senior vice president at the Greater Boston Chamber, says businesses simply don’t have the information they need to be ready on July 1.
Among the most pressing issues: who gets to opt out.
The bill was intended to exempt companies that already offer more generous benefits than the state program does — 12 weeks of family leave, and 20 weeks of medical leave. But the criteria apparently make it almost impossible to qualify. Ryan says she has talked to companies that offer four months of paid parental leave but still don’t know if they can opt out.
Representative Joe McKenna has heard similar concerns. The Webster Republican says he recently heard from the owner of a child-care center in his town who had no idea what she is supposed to do to comply. That prompted McKenna to circulate a letter at the State House earlier this week, calling for the delay. He says he gathered more than 50 supporters from the House and Senate, Republicans and Democrats.
Companies also have to make tough decisions about how much they pay, and how much they pass on to employees. It’s a tight labor market, and many bosses are reluctant to chase talent away.
And then there’s the unsuspecting public: Many workers don’t even know this hit is coming.
The clock is ticking. But there’s nothing like a deadline to motivate the powers that be on Beacon Hill. In true State House style, the decision will be down to the wire.
One wise man might even say it’s déjà vu, all over again.