Paid leave bill passes Senate

Republicans voice small business concerns
March 15, 2022

A bill that would allow paid family and medical leave for workers who do not have that benefit passed the Senate 14-7 on March 8, clearing the way for its consideration in the House.

The Healthy Delaware Families Act received support along party lines, with no Republicans voting for the bill. 

“This is a Delaware solution for Delaware challenges,” said Sen. Sarah McBride, D-Wilmington, sponsor of the bill, which has already received support from Gov. John Carney. “Paid leave works.”

The bill would give eligible workers up to 12 weeks of paid parental leave a year, and up to six weeks of paid leave for family caregiving. During their leave, workers would receive up to 80% of their average weekly wages through the state insurance program.

A one-time cost of $17.7 million would be needed to set up the program for fiscal year 2023, with $3.4 million in ongoing costs. Ongoing costs increase to $6.6 million in FY2024, but would be split in FY 25 – the year the program kicks off – with $3.7 million coming out of the general fund and another $3.7 million out of special funds mostly made up from payroll taxes.

Employers and employees would each pay .04% in payroll taxes to help fund the program; future costs are expected to increase 2% a year, according to the controller general’s fiscal note.

The Department of Labor is tasked with administering and enforcing the program. Businesses with fewer than 25 employees are given some breaks. Businesses found in violation of the law could be fined up to $5,000 and face civil litigation.

Several upstate legislators shared personal healthcare stories as they promoted the need for the bill, comparing the tax increases to the cost of a cup of coffee.

However, downstate Republicans, echoing concerns from the small business community, balked at the comparison.

“Concern lies with small businesses that right now are struggling to find employees,” said Sen. Brian Pettyjohn, R-Georgetown. 

Finding a replacement for someone who takes weeks off for personal leave has proved difficult, he said. “Without them, the business grinds to a standstill,” Pettyjohn said.

Minority Leader Sen. Gerald Hocker, R-Ocean View, owner of a supermarket chain, said the business community is already financially stressed coming off pandemic restrictions now compounded by higher gas prices, and he fears many businesses will be forced to close shop.

“We are on the verge of an economic disaster,” he said. “You add any more expense to this, you’re going to see people fold.”

The Delaware State Chamber of Commerce and the Delaware Business Roundtable issued a joint statement March 8, coming short of endorsing the Healthy Delaware Families Act.

“As we continue to look at the bill, we are pleased that it is increasingly closer to a policy that allows both employers and employees to appropriately deal with life events while recognizing the economic realities of running a business,” the statement read.

The bill now moves to the House for consideration.

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