ST. PAUL – House Democrats approved legislation Tuesday which Rep. Matt Bliss, R-Pennington, said will hurt employee wages and damage businesses by establishing a mandatory paid leave program funded by a new tax on employers and workers at a time the state has a $17.5 billion surplus.
“The program House Democrats propose takes a one-size-fits-all approach that lacks flexibility our businesses need, particularly in Greater Minnesota,” Bliss said. “Their plan fails to recognize how many employers in rural parts of our state only have one or two employees – and are more than happy to work with them to make accommodations. A heavy-handed state mandate is the last thing our job creators and workers need these days.”
Bliss said the program (H.F. 2) would cost billions of dollars to get up and running and require as many as 400 new full-time government employees to develop and administrate. He added the program applies to virtually every industry in the state – private employers, nonprofits, cities, counties, and school districts – despite objections. It would be funded with a $2.9 billion tax on employers and employees and expands employers’ leave obligations to part-time and temporary employees. The Minnesota Chamber of Commerce reports 80 percent of its members already provide paid family leave, Bliss said.
Unlike the Federal Family and Medical Leave Act, which only applies to employers with 50 or more employees, Bliss noted this program would apply to all employers including those with only one employee. Employees can stack leave together, allowing for up to 24 weeks of paid time off per year.
On the other hand, Bliss indicated Republicans have developed a plan which takes a different approach, providing a small-business tax credit to incentivize employers to join the plan. The key difference, he said, is the minority’s plan provides paid family and medical leave benefits for employees without job-crushing mandates and new taxes.
The House Republican proposal provides a small business tax credit to incentivize employers to join the plan. Minnesotans may opt into the program for $5 per week if an employer does not join by using the parameters of the state’s paid leave policy, leveraging the power of the state’s 10s of thousands of employees. Employees who are satisfied with current benefits offered by their employers can keep them without being forced onto a government-run program.
“We need to adopt a model where employers can voluntarily participate in a partnership with the state instead of the state acting as an overlord,” Bliss said. “The House Republican plan makes this happen without new taxes and mandates.”
Bliss also indicated the House Republican option is backed by an insurance company, so taxpayers will not be expected to cover the costs of program shortfalls or losses. Benefits would be available to Minnesotans this Jan. 1 – a full 18 months earlier than the House Democrat proposal.
The House Republican plan was offered as an amendment to the Democrat bill on Tuesday. House Democrats voted down that offering before approving their own bill, sending it to the Senate for action.
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