Why Social Security is the Focus of a Family-Leave Bill
Comprehensive family-leave policies are quickly taking center stage at companies on the leading edge of HR innovation—but, without legislative action, many American workers have been left in the lurch.
The U.S. remains the only developed nation to lack a mandate for paid maternity leave—let alone, parental or family leave. As the labor market tightens, the significance of family-leave polices as tools for attraction and retention has heightened, prompting lawmakers on both sides of the aisle to weigh in.
A Democrat-led bill hit the floor of Congress in February that would guarantee all full-time American workers up to 12 weeks of paid time off for family leave—loosely defined to include birth, adoption and serious illness affecting the employee, a spouse or close family member—though it has yet to gain traction. Last month, a new Republican-led proposal surfaced with a different take: letting workers tap into their Social Security to pay for time off.
The Economic Security for New Parents Act is being led by U.S. Sen. Marco Rubio (R-Fla.) with co-sponsor Sen. Mitt Romney (R-Utah), while a House version is spearheaded by Reps. Ann Wagner (R-Mo.) and Dan Crenshaw (R-Texas). The legislation would allow parents to “pull forward a portion of their Society Security benefits” to finance up to three months of leave following the birth or adoption of a child, according to a statement by Rubio. According to the senator, “The benefit amount is large enough that nearly all parents below the median household income of about $60,000 will be able to take significant leave at a rate of two-thirds of their prior wages,” and some could extend the leave beyond three months.
Rubio’s bill proposes that, to finance this option, parents would have to increase their Social Security retirement age by three to six months, or receive a proportionate reduction in monthly retirement benefits for the first five years of retirement. The Social Security Administration would be responsible for processing and approving applications for parental leave.
Steve Wojcik, vice president of public policy at the National Business Group on Health, says that, while more specifics about the legislation are needed, “linking paid leave to Social Security sounds complicated.”
As the circle of federal bills taking a stab at family-leave policies widens, more and more states are also taking their own actions—which Wojcik says can muddy the waters for employers.
“The proliferation of state and local requirements is creating a compliance burden, even for the many employers who offer generous paid leave voluntarily to their employees,” he says. “Having a uniform national standard would eliminate the challenges. However, so far, Congressional proposals don’t appear to preempt state and local action.”