Montana Task Force Explores Paid Family, Medical Leave for State's Workers

Jun 30, 2016

By MBPC Staff

Missoula Current, June 30, 2016

It’s almost guaranteed that a Montana worker will have to step away from the job to care for an aging parent or give birth to a child. Many employees will fall seriously ill and need time to recover.

Under all three scenarios, most Montana workers will have to do so without pay.

On Wednesday, the Equal Pay for Equal Work Task Force gathered in Missoula to examine the results of a two-year study conducted by the Montana Budget and Policy Center.

The report, “Helping People Balance Work and Family,” found that a paid leave program would enable roughly 445,000 working Montanans to take time off after the birth of a child, care for a seriously ill family member or recover from serious illness, and do so with pay.

The program could also take a bite out of the gender wage gap, and do it all at a minimal cost to both employees and their employers.

“Access to paid leave has a significant impact, especial on women,” said Heather O’ Loughlin, co-director of research and development at the policy center. “Studies show that women who give birth are twice as likely to return to work after giving birth if they have access to paid leave. Access to paternity leave and access to leave for men also helps address the wage gap. Access for both men and women are important.”

The U.S. remains the only industrialized economy in the world that doesn’t guarantee paid leave for new mothers, and it’s one of many that doesn’t extend the same opportunity to new fathers. The lack of such coverage leaves many working Americans at financial risk.

Given the absence of a national policy, four states have moved to establish a statewide family leave insurance program, including California, New Jersey, Rhode Island and New York. Several other states are currently considering the legislation, and Montana could soon follow suit.

“Generally speaking, it’s similar to the way unemployment insurance works,” said O’ Loughlin. “Eligible individuals are able to access a certain number of weeks to take off. They receive a certain portion of their wages at that time, and they can take that for certain circumstances.”

Those circumstances can include personal care during a serious medical condition, caring for a family member with a serious medical condition, and for parental leave. The program is self funded through contributions made by both the employee and the employer.

“Establishing a statewide insurance program allows the state to cover as many workers as possible,” O’ Loughlin said. “By including as many workers as possible, the cost on an individual basis is much lower. States that have a family and medical leave insurance program, contributions into the fund are generally less than 1 percent of their wages.”

Julia Cramer, a policy analyst with the Montana Budget and Policy Center, said the research turned to program data generated primarily by California and New Jersey.

In those states, less than 1 percent of individuals covered by paid leave take family leave, and just over 2 percent of covered individuals take medical leave.

“That’s not exactly the case in Montana because we have different demographics here,” Cramer said. “We have fewer women who are employed and who are pregnant that would be taking family leave in Montana. But we have a higher proportion of individuals who are older and working or have disabilities, so medical leave rates in Montana would be slightly higher.”

The model used to create the Montana proposal estimates that on average, workers covered by paid leave would take roughly 10 weeks of a 12-week program for family leave, and about 8 weeks for medical leave.

“In the first year, over 12,000 people in Montana would use the program for medical leave, and almost 3,000 individuals would use it for parental leave,” said Cramer. “Another 400 would use it for care-giving purposes.”

The model also suggests that 95 percent of the employed population in Montana would be covered by the program, amounting to roughly 445,000 individuals. Low wage workers would receive a higher portion of their earnings.

Under the proposed scenario, those earning up to $21,000 would receive 100 percent of their weekly wages, or $413 a week. As incomes increase, the benefits would slowly scale down. For higher income earners, they’d earn about 67 percent of their weekly wages, Cramer said.

“Because this is a statewide insurance program, you could finance this through shared contributions from employees and employers,” Cramer said. “These shared contributions would equal less than half of 1 percent of annual wages. If you have someone earning $40,000 a year, the worker would contribute roughly $7 a month into the program, and the employer would contribute the same.”

Last year, Gov. Steve Bullock issued an executive order to create the Montana Equal Pay for Equal Work Task Force, chaired by Labor Commissioner Pam Bucy and Department of Administration Director Sheila Hogan.

The task force includes 10 members representing business, labor, tribal and education. All were in attendance on Wednesday, along with a handful of organizations, including the Montana Human Rights Bureau and AARP Montana.

“There are 118,000 Montanans caring for adults, and that’s not a small population,” said Claudia Clifford with AARP Montana. “We’re a very aging state and it’s very costly to families. If families can’t take the time to help care for their elders, then the elders spend their money down faster and end up on Medicaid. It has real state fiscal impacts.”

Bucy said the Equal Pay for Equal Work Task Force will make a recommendation to Bullock, who in turn is expected to forward a policy recommendation during the 2017 Legislature if he’s reelected to office.

“We know for a fact the inability to take time off work to care for your family, whether it be children or aging parents, impacts women more than men, and it does cause significant disparities in pay in the long run,” Bucy said after Wednesday’s meeting. “This is a pretty significant issue. You add our aging demographics and it becomes an even more significant issue.”