Rhode Island Passes Paid Family Leave Bill

Rhode Island lawmakers have recently passed a bill that positions the state to become the third in the country to offer wage replacement during family leave, after California and New Jersey.  The Temporary Caregiver Insurance Bill (H.B. 5889, S.B. 231) is now awaiting the signature of Gov. Lincoln Chafee, who has already expressed his support.

The Temporary Caregiver Insurance (TCI) bill will be the first law in the U.S. to protect the job security of all employees needing to take leave. The bill will ensure that workers can take up to four weeks of paid leave to take care of a new child, a seriously ill family member, or themselves.

TCI was supported in the legislature by coalitions of workers, local business owners, economists, health care providers, health and family advocates, as well as national business associations. Support for the bill undeniably outnumbered opposition as legislators who are small business owners pointed out that the measure will benefit the economy by helping people cover the basics.

"I want my employees to be able take care of who they need to at home without worrying about being able to cover their bills. An employee who is distracted on the job is no good to me, and after a period of paid leave, they come back to work and stick with me for years. Hiring and training replacement workers is expensive, so keeping turnover low is a huge cost saver for any business”, said  Ann-Marie Harrington, President of Embolden, a digital media firm in Pawtucket and one of the many Rhode Island business owners who contacted legislators in support of TCI.

Similar paid family leave insurance programs in California and New Jersey have proven popular among business owners. A 2011 study of California's family leave insurance (FMLI) program estimated savings for employers at $89 million a year. The program has been easy to implement and most California employers coordinate their own benefits with the state's FMLI program. A recent Rutgers study shows that New Jersey's FMLI program has reduced costs by decreasing turnover and improving productivity.

TCI builds off of Rhode Island's existing Temporary Disability Insurance program and extends replacement income to workers who need to take time off. The program is revenue-neutral and is funded solely through employee contributions which amount to about 64 cents a week for workers earning $40,060 a year. These pooled payments provide replacement income to keep families afloat, and off public assistance, during the time when they are caring for family members.

The Huffington Post reports that more than 70 percent of children in Rhode Island live in families with all parents working, so loss of income for a primary breadwinner and caregiver has significant economic consequences for the whole family. Many families cannot afford to have one parent miss work to care for a family member, and studies show that many bankruptcies happen after a worker misses two or more weeks of work due to illness.

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