Mandate would be latest blow to NM’s small businesses
Move over COVID restrictions, record inflation, a 60% higher minimum wage and recently-required paid sick leave. There’s a new mandate in town, with small businesses — once again — squarely in its sights.
Here’s how a legislative proposal on “paid family medical leave” would work:
The state would collect a portion of every worker’s paycheck, .5%, and employers would have to nearly match each employee’s contribution. With that money, a massive government office of up to 200 employees would be created to oversee and manage a new paid-leave mandate.
Businesses would be required to grant up to three months of paid leave per year to each employee for a long list of qualifying circumstances — from the birth or adoption of a child, to a serious illness, to being a stalking victim. Financed by workers and employers, the fund would be used to pay people a substantial portion of their salary while they’re not working, and businesses would foot the bill for adjusting to extended or repeated absences in the workplace.
Interestingly, this new tax on workers and employers could simply be raised by the Secretary of Workforce Solutions whenever the fund needs more money. Employees could “stack” various types of company-provided and state-mandated leave, extending their absence even longer than three months. And believe it or not, a person could take leave for situations relating to non-family members — it just needs to be someone “related by blood or affinity” who has a “close association” with the employee or their spouse/partner.
We cannot understate just how hard it would be to manage a small business under circumstances where so much leave, under such loose conditions, could be taken with such frequency by employees.
Ninety percent of New Mexico businesses have 20 or fewer employees. They lack the flexibility to absorb long-term vacancies, move employees around to fill gaps, or quickly hire new employees — especially in a state with the nation’s third-lowest labor force participation rate. Workplace disruptions and staff shortages — and their associated impacts on customers, employees and managers alike — would become even more commonplace than they already are in our post-COVID economy.
It begs the question: Who do we think we are?
Given all the attempts by lawmakers to make it harder for businesses to operate or open here, one would think New Mexico has a robust, thriving private sector. We don’t. One would think inflation and supply chain problems have gone away. They haven’t. And one would think our population is growing. It isn’t. We don’t have the luxury to pass laws that make it harder to run a business and create jobs.
We are a state that prides itself on its authenticity and strong local feel. We love and depend on our small employers. They’re the iconic “skylines” and “help just around the corner” in towns and villages across our beautiful state. And this mandatory leave proposal would hurt them most.
Make no mistake: Each time a new cost or burden is added to the back of a small business, New Mexico’s economic diversity takes another hit. We become more corporate and less unique.
Blunt, costly and bureaucratic mandates won’t create stronger workplaces, but they will lead to fewer jobs, fewer entrepreneurs, fewer companies offering generous employee benefits on their own, and more challenging work environments for everyone.