ST. PAUL – House Democrats approved legislation Tuesday which Rep. Ben Davis, R-Mission Township, 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.
“This is an example of more costly, burdensome government overreach that goes to show how out of touch metro-centric Democrats are with Greater Minnesota,” Davis said. “This program simply is not going to work in our part of the state, with the dynamics we have. It’s so easy for legislators from the metro area to forget this and come up with statewide mandates that treat our small towns the same as the Twin Cities. We need flexibility and a voluntary system to help people meet their needs and that is what House Republicans are proposing.”
Davis said the House Democrat bill (H.F. 2) would cost billions of dollars to get this new program 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, Davis said.
Unlike the Federal Family and Medical Leave Act, which only applies to employers with 50 or more employees, Davis 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, Davis indicated House 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 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.
“If you like your current employer-based benefits, you should be able to keep them and not be forced into a government-run program,” Davis said. “And, if you think there’s room for improvement, the Republican plan provides an option. The difference is we provide flexibility for people to do what’s best for them instead of government telling them what they must do.”
Davis 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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