California’s Paid Family Leave program – the first of only two state programs in the country that offer paid leave to workers when they take time off to care for a new child or sick family member – has received high marks from employers and employees alike.
In a first-of-its kind study released this week, researchers examined California’s paid family leave program six years after implementation. They determined that early business concerns over costs and potential abuse of the program were unfounded, and confirmed that paid family leave has widespread economic, social and health benefits for the state.
The results of the study should boost efforts by state policymakers who are looking for ways to fund Washington state’s own Family Leave Insurance program.
“Paid family leave has been remarkably successful in California since the state first created it six years ago,” said study co-author Ruth Milkman, professor of Sociology at UCLA and the City University of New York. “It has helped hundreds of thousands of workers – especially in low-wage jobs – balance the costs and challenges of tending to family and work. Despite the fears of critics when it was first enacted, the paid family leave program has been well received: the employers and employees we surveyed overwhelmingly give the program high marks, and for those who use it, the result has been better economic, social, and health outcomes.”
The study analyzes surveys conducted in 2009-2010 of 253 employers and 500 individuals across the state about their experiences with the California PFL program. The law provides eligible employees up to six weeks of wage replacement at 55 percent of their usual earnings to bond with a new child or care for a seriously ill family member.
Funded solely by employees paying into the program, the maximum payment is indexed to the state’s average weekly wage and is $987 per week in 2011. According to California’s Employment Development Department, in FY 09-10, 167,253 Californians used Paid Family Leave for bonding with new children and 23,220 used it to provide care for seriously ill family members.
The employers surveyed – spanning a diverse and representative sample of the state’s industries and regions – overwhelmingly reported that paid family leave had either a “positive effect” or “no noticeable effect” on productivity (89 percent), profitability/performance (91 percent), turnover (96 percent), and employee morale (99 percent).
Small businesses were less likely than larger establishments to report any negative effects, and the vast majority of employers (91 percent) said “No” when asked if they were aware of any employee abuses of the program.
Many employers (60 percent) also reported that they coordinated the state Paid Family Leave program with benefits they already provided – meaning employers saved money when their employees used Paid Family Leave instead of, or in combination with, the paid leave supports these employers would otherwise have paid for.
Read more from the report | Leaves That Pay: Employer and Worker Experiences with Paid Family Leave in California