Model Partnership: Private Sector and Paid Leave
The Family and Medical Leave Act (FMLA) turned 30 years old this year. This landmark legislation offered job protection for workers so that they did not risk losing their jobs if they needed time off to care for their own health or that of a loved one. But 30 years and one pandemic later, we have learned that job protection isn’t enough. People need income protection during their leave as well.
For decades, employers have recognized the value of paid leave by offering disability income insurance (DI) to replace a portion of employee salaries for time off to recover from an illness, injury, or the birth of a child. Now more than ever we see that people also need paid time off to care for loved ones, and to welcome a new child into the home.
As bipartisan federal discussions about paid leave continue, policymakers can consider incremental ways to make paid family leave benefits more available to employers and their workers. Last year, the National Council of Insurance Legislators (NCOIL) adopted a model law that allows states to recognize paid family leave benefits as a form of insurance. As this model law is passed in more states, it will allow insurers to create new products they can offer alongside traditional DI insurance to enhance benefits to include paid family leave coverage. Virginia was the first visionary state to pass the legislation. Since then, Arkansas, Florida, and Tennessee have passed similar legislation, with Texas and South Carolina also considering the model.
Each legislative season the list of states will grow, and the NCOIL model will help keep the paid leave conversation moving forward. Policymakers can further help employers and their workers with federal tax credits and creative ways to fill vacant seats through existing jobs programs.
No matter what model a state or the federal government chooses, ACLI’s member companies stand ready to support policymakers and help build sustainable paid leave with strong private sector options that go above and beyond to meet the needs of workers and their employers.