Washington Policy Watch

News and perspective on public policy issues affecting Washington's economy and quality of life, brought to you by the Economic Opportunity Institute.

February 3, 2012 • 8:48 am 1

Research shows paid family leave not only better for families and workers – it’s better for business too

Several states have adopted paid family leave policies as an important protection for the economic security of working families. After New Jersey implemented its own statewide policy in 2009, researchers from Rutgers decided to investigate how workers benefited from the change. They found paid leave is not only good for families, it’s better for businesses and leads to reduced use of public assistance:

  • Women who take paid leave are more likely to be working one year after a child’s birth than those who do not take leave. This means that employers who invest in their workers ultimately benefit from reduced turnover. Recruiting and hiring new employees is far more costly than keeping the ones you already have.
  • Both women and men who take paid leave are significantly less likely to utilize public assistance programs than those who do not take leave. Food stamps and other public assistance programs are necessary to protect the most economically vulnerable. But it makes sense to invest in programs that prevent poverty, too. Putting systems in place to best support our workforce ultimately reduces the extraordinary fiscal and social costs of poverty – something that benefits all members of our communities.

As more women have entered the workforce and the population has aged, increased numbers of workers have found themselves in situations that require an extended absence from work – whether to care for a new baby, an aging parent or a sick spouse.

The 1993 federal Family Medical Leave Act, ensured up to 12 weeks of unpaid leave for workers to bond with a new child or care for sick family member. This legislation set an important workplace standard, but its reach is limited — extending only to companies with more than 50 employees and putting restrictions on which workers are able to access the benefit. And, of course, the leave is unpaid. While time to bond with a child or care for a family member is critical, the loss of income over an extended period of time is often impossible for families to manage.

To address the inadequacies of the federal policy, several states have crafted more extensive and inclusive policies to better meet the needs of working families. Currently, two states – California and New Jersey – have policies in place that offer family leave insurance as a component of their temporary disability insurance programs. Both offer up to six weeks of paid leave.

Washington, too, established a Family and Medical Leave Insurance Program in 2007 to provide workers with up to 5 weeks of paid leave. However, the program has not been funded, and implementation has been pushed to 2015. In the meantime, advocates from the Washington Family Leave Coalition have been working to improve the legislation (including an increase to 6 weeks of paid leave) and update the funding mechanism.

Until Washington and other states can establish good policies to address the needs of working families, many will continue to struggle for economic security. Paid family leave is an important workplace benefit that ultimately extends far beyond workers – promoting healthy business, families and communities.

Filed under: paid family leave, work and family, , , , ,

February 2, 2012 • 8:32 am 0

Restaurant owners taking the ‘high road’ report better loyalty, creativity and productivity

Taking the High Road: A How-to Guide for Successful Restaurant Employers

A new report from Cornell University and Restaurant Opportunities Center United highlights examples of restaurateurs across the country who have created “win-win-win” solutions for workers, diners, and employers by using “high-road” employment practices.

Nationally, restaurant workers typically earn very low wages; 90% do not receive paid sick days, paid vacation, or health insurance through their employer either. The Cornell/ROC report highlights just how much those policies cost employers: between $4,000 and $14,000 per employee turnover. Costs include recruitment and screening, training, uniforms, admin, and unemployment insurance — as well as negative impacts on team morale, trust building, and relationships with regular customers.

The alternative is “high road employment”, which employers in this report define as practices that support workers and unleash their loyalty, creativity, and productivity to make the restaurant successful. Those practices include livable wages, a healthy workplace through paid sick days, vacation, or health insurance; and career ladders for employees through training and internal promotions policies.

Several prominent local restaurant owners were part of the campaign for a paid sick days ordinance in Seattle, citing the positive effects paid sick days have on the bottom line by improving morale, reducing turnover and reducing the spread of illness. The high-road employers interviewed for this study also reported that the benefits of increased productivity and reduced cost of employee turnover outweigh short-term costs of improving workplace practices. Summary | Full report

Filed under: minimum wage, paid family leave, paid sick days, , ,

January 30, 2012 • 12:28 pm 0

Small business owners shun lobbyists, call for “high-road” workplace standards

Jamie Vaughn, owner of Revival Lighting in Spokane

Business experience, academic research and political muscle are backing calls by small business owners for “high road” business and economic development policies – and policymakers are listening.

The recent campaign for paid sick days in Seattle featured local business leaders like Dave Meinert, Makini Howell and Jody Hall. And they didn’t just support the idea – they helped craft the proposal that eventually became law. As Howell put it in an open letter to business owners:

“Not only can paid sick days work for my business, I believe it is exactly the type of public policy that makes our community stronger. Ultimately, strong businesses need strong communities to thrive.”

Before you write that off as the “Seattle liberal establishment” at work, take a look at this article from the Spokane Inlander about Revival Lighting owner Janine Vaughn, who:

showed up as a simple small business owner in Inlander stories about income-tax Initiative 1098 (arguing it would save her small business money) and workers-comp insurance-privatization Initiative 1082 (arguing it would cost her small business money).

Vaughn is a member of the small business lobbying group Main Street Alliance, which initially formed to support the small-business friendly aspects of proposed national health care reform legislation.

The Main Street Alliance, Vaughn explains, is made up of mostly smaller businesses. That’s why they tend to stand in such stark contrast to traditional business lobbying groups – and the Republican agenda.

That kind of contrast gets noticed. The White House has been in touch to get the Alliance’s views on public policy issues that affect small businesses and their employees:

“It’s actually very surprising,” Vaughn says about her sudden ubiquity in the press. “They’re actually listening to the small business voice. It’s exciting.”

Academic research backs up these business owners’ experience with “high road” economic development policies like a strong minimum wage, paid sick days, and paid family leave.

  • The latest research by economists comparing counties that share borders across state lines has found that increasing the minimum wage not only increases the incomes of low wage workers, it does so without decreasing the number of jobs. And it benefits employers by decreasing costly turnover.
  • Since New Jersey’s paid family leave policy was implemented in 2009, and researchers at Rutgers have found paid leave is not only good for families, it’s better for businesses and leads to reduced use of public assistance.
  • A study in the American Journal of Public Health demonstrates how a lack of workplace policies such as paid sick leave contributes significantly to illness among Hispanics — and thus the general population.

This is a welcome and exciting trend – one that bodes well for Washington’s (and America’s) businesses, families and communities as we strive to restore the promise of the middle class and build an economy that works for everyone in the years to come.

Filed under: minimum wage, paid family leave, paid sick days, state economy, work and family, , , , , , , ,

January 26, 2012 • 12:06 pm 0

Raise your hand if you want to lose your job to care for someone you love

Paid leave isn’t only crucial for ensuring parents can care for their children – it’s also important for adult children, an increasing number of whom are caring for an elderly relative. But while having time to care for a loved one is important to nearly all of us, not everyone can do it without risking part of their paycheck or even their job.

For example, when parents can’t take a paid sick day, children are less likely to go to the doctor and more likely to go to school sick. But a 2003-2004 study indicated that only 36% of American children in families below 200% of the federal poverty line had a parent with sick leave, compared with 81% of those above 200% of the poverty line.

At the other end of the age spectrum, this 2008 study shows nearly 1 in 5 American workers provided unpaid care to an elderly person that year, and more than 4 in 10 provided care in the previous five years. But low-income families living from paycheck-to-paycheck are the least likely to have paid sick days available on the job. In the U.S., just 2 in 10 of the lowest paid workers had access to paid sick leave in 2010, compared to 84% of the highest earners.

Given their importance to so many people, it’s no surprise to see so many people “raise their hands” for a minimum paid sick days standard. A 2008 poll from the National Opinion Research Center at the University of Chicago found:

  • 94 percent of self-identified liberals and 81 percent of self-identified conservatives believed that paid sick day should be a basic workplace right.
  • 86 percent of people surveyed said they favor a basic paid sick day policy.
  • 77 percent of respondents believed that paid sick days were very important.
  • 63 percent of workers who did not have access to paid sick leave said they were concerned about not having paid sick days.
  • 46 percent of respondents said they are more likely to vote for a candidate who supports paid sick days.

Filed under: paid sick days, work and family, , , , , , ,

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