Paid Family and Medical Leave really a win for business

Facts are crucial when explaining legislation. So it’s necessary to debunk a recent Albuquerque Journal editorial that completely misses the point on how Paid Family and Medical Leave actually supports businesses and the economy.

The Feb. 28 editorial argues Senate Bill 11, the Paid Family and Medical Leave Act, has a “whopping 12 weeks of paid leave annually.” However, when actually reading the bill, the proposal provides only “a maximum of 12 weeks of paid leave for employees to take care of their own serious health conditions or to care for a seriously ill family member” if and when the time-off application is approved by the Department of Workforce Solutions. This means claims aren’t automatically approved for 12 weeks and, based on data from other states, most workers use less than 12 weeks.

There are claims that, although SB 11 exempts employers with fewer than five employees, about 66% of all small businesses in New Mexico, businesses will continue to struggle to cover for the missing employee, especially when they have trouble recruiting employees now. However, studies show paid family and medical leave policies benefit small businesses by improving employee retention, reducing turnover costs, and increasing employee productivity and loyalty.

The editorial argues SB 11 would result in a “significant deficit of $516 million by the 2028 budget year” just two years after implementation. However, they rely on a Legislative Finance Committee report that overprojects the program’s usage rate. Using up-to-date state data, UNMBBER’s estimates 35,126 yearly claims. Meanwhile LFC projects 87,125 yearly claims.

SB 11 proposes a self-sustaining funding model in which both employers and employees make small bi-weekly contributions averaging less than the cost of a cup of coffee to a state-managed fund that will cover the employee’s time off when and if approved by DWS. This is an innovative insurance policy that safeguards the bottom line of businesses and allows workers to care for their health or that of their loved ones without losing their entire pay.

And it’s worth noting: According to the 2021 American Community Survey Public Use Micro Sample 1-Year Estimates, there were 14,486 total absences from work, which is only 1.8% of workers in the state and who could be eligible for PFML.

The N.M. Risk Management Bureau and state employees have about 50 claims a month for short-term disability or about 600 claims a year. This represents only about 4% of all possible work absences in New Mexico.

In states that have implemented PFML, these are the usage rates:

California (2020) 5.52%; New Jersey (2020) 2.74%; Massachusetts (2022) 3.14%; Washington (January 2023) 5.05%; Rhode Island (2021) 6.26%; and Connecticut (2022) 1.2%.

Lastly, we keep hearing the state should focus on solving public safety, health care and an inequitable tax system. Well, the truth is that paid family and medical leave is crucial for promoting public health and safety, reducing health care costs and addressing income inequality.

I urge lawmakers to read the facts and support SB 11 to prioritize the health and well-being of NM’s families, workers, businesses and economy.