New England Biz Law Update
A bipartisan effort to establish a more unified approach to paid family leave across the U.S. is gaining momentum in Congress, potentially addressing one of the most significant gaps in American employee benefits.
Representatives Chrissy Houlahan (D-PA) and Stephanie Bice (R-OK) have introduced the “More Paid Leave for More Americans Act,” legislation that would create a framework for states to develop their own paid family leave programs while providing some level of consistency and portability across state lines.
A state-driven solution to a national problem
The U.S. remains one of only six countries worldwide without a national paid parental leave policy, according to the Bipartisan Policy Center. The new legislation aims to change that through a state-driven approach.
“Regardless of party, Americans believe that Congress must act and support efforts nationwide to advance paid family and medical leave,” Houlahan said in a statement about the bill.
The legislation would establish a three-year pilot grant program overseen by the Department of Labor, providing financial incentives for states to create paid family leave programs that meet specific criteria:
- Offering at least six weeks of paid leave for childbirth or adoption
- Providing wage replacement between 50% and 67% of an employee’s income (depending on income level)
- Capping benefits at 150% of the state’s average weekly wage
- Using a public-private partnership model
- Participating in the new Interstate Paid Leave Action Network (I-PLAN)
The interstate solution: I-PLAN
A key innovation in the legislation is the creation of the Interstate Paid Leave Action Network (I-PLAN), designed to address a major pain point for both employers and employees: the current patchwork of varying state requirements.
The I-PLAN would act as a federal intermediary between states to:
- Establish best practices based on successful state programs.
- Help harmonize benefits across differing state requirements.
- Resolve conflicts for employees who live and work in different states.
What it could mean for employers
For businesses operating across multiple states, the legislation could simplify compliance by creating more uniformity in paid leave requirements.
The bill includes an employer opt-out provision in cases where a state’s program mandates employer participation, provided the employer’s benefits meet or exceed the state program’s thresholds.
Funding
The proposal includes approximately $500 million in funding, with $265 million allocated to the state grant program and $235 million for the I-PLAN initiative. Grants to states would range from $1.5 million to $7 million.
A long road ahead
The U.S. has seen multiple attempts at establishing paid family leave legislation in recent years.
Whether this bipartisan approach will succeed remains to be seen, but the involvement of legislators from both parties and the state-driven approach may improve its chances of passage.
The bill is the result of two years of work by the bipartisan House Paid Family Leave Working Group, whose members include Representatives Mariannette Miller-Meeks (R-IA), Haley Stevens (D-MI), Julia Letlow (R-LA), Don Beyer (D-VA), Randy Feenstra (R-IA), and Jimmy Gomez (D-CA).
