families form a central pillar of our society. The critical role of the family is a value shared by Republicans and Democrats alike. One of the toughest challenges we face, individually and as a community, is balancing work and family.
It’s a tougher challenge than ever for today’s working family. According to data collected by the MIT Workplace Center, in 1979 only two out of three mothers with children under 18 worked. Today, four out of five mothers work, and both mothers and fathers are working longer hours. At the same time, many of us have aging parents. As the Baby Boom generation matures, more and more of us will be caring for our children and our parents at the same time.
From corporate executives and investment bankers to secretaries and janitors, everyone struggles to strike the right work/family balance. But many working families face an added financial struggle. The costs of housing, electricity, home heating fuel, and college education are higher than ever. In our changing global economy, incomes for many middle-class workers with children or dependents have stagnated.
This year, my colleagues and I have offered a plan to provide support for all working families in Massachusetts. Our bill includes two main parts: targeted tax cuts, and paid family and medical leave. Designed properly, these programs will place only minimal burdens on businesses and will actually strengthen our state’s economic competitiveness.
Tax cuts for working families. Our legislation proposes two types of tax cuts for working families. First, we propose increasing the deduction for child and dependent care expenses from its current level of $4,800 for a child or dependent to $10,000 (or $15,000 for two or more dependents). This will ease the strain on all of those families that pay for child care or preschool for their children, or who pay for the care of a disabled or elderly parent or spouse.
Second, our proposal increases the standard deduction a taxpayer can take for dependents under age 12, over 65, or disabled. For working families with incomes of $75,000 or less, we would increase the deduction for a dependent from $3,600 to $5,000.
These tax cuts would deliver relief to those who need it most. Now that the state has weathered the fiscal crisis of the past years, we can afford these reasonable measures, which will cost $67 million to $70 million per year.
Moreover, these tax cuts will help our economy. By exempting more child and dependent care expenses from taxation, we make sure that more workers can afford to work.
Paid family and medical leave. In addition to tax cuts, our plan guarantees paid family and medical leave for every worker in Massachusetts to take care of a new baby or a seriously ill child, husband, wife, or parent.
Federal law guarantees unpaid medical leave for employees at large companies, and state law guarantees unpaid maternity leave for new mothers at companies with six or more workers. But studies have estimated that about 80 percent of employees cannot afford to take leave if it is unpaid.
Our paid leave proposal follows the lead of California, which passed a similar law in 2002. Like California’s system, our program would be funded solely by contributions from employees. Thus, businesses would not have to make any contribution toward family leave benefits.
Our proposal goes further than California’s, however, and would create the most generous paid leave system in the nation. It would guarantee up to 12 weeks of paid leave in a year, and would pay a worker’s full salary up to a cap of $750 per week. By contrast, California provides only six weeks of leave and pays for only 55 percent of an employee’s salary, up to a similar cap.
To protect against fraud and abuse, our paid leave program would include several safeguards. Other than for new-baby leaves, an employee would need written certification from a doctor saying that the employee or a family member has a serious medical condition that required time away from work. Workers would be entitled to paid leave only after a five-day waiting period, during which they would have to use up sick time or vacation time or take leave without pay. And a worker would be eligible to take family leave only if he has worked for his current employer for the past nine months, and for a total of at least 900 hours. Of course, we would impose tough penalties on anyone caught submitting fraudulent claims.
Even though our paid leave proposal would not require employers to pay for any of the financial benefits for workers who need time off, some organizations have raised concerns about the effects on business. They declare that paid leave will create new administrative burdens and force employers to find temporary replacements. Those concerns are real, and we will consider revising the program’s parameters to address them.
However, a thorough and balanced analysis shows that these concerns are overstated.
Employers in Massachusetts, including small businesses, already face the burden of coping when an employee is sick or needs time off to care for a new baby or a sick family member. Many economic studies show that paid leave programs improve worker productivity and morale and also reduce turnover. A worker who is sick, or who has a seriously ill family member, is not likely to be very productive. Under our program, the worker could take a temporary leave, and the company could use the wages it saves on that worker to hire a temporary replacement.
In the long run, paid leave will improve our economic competitiveness. The key way for Massachusetts to compete in the global economy is to invest in human capital and attract the best workers. Our edge is having the best possible workers, innovators, and entrepreneurs. We can attract and retain the best talent in the world by making sure that Massachusetts is a place where you can work and also have a balanced, rich family life.
Using a sophisticated model, two economists from the University of Massachusetts, Randy Albelda and Alan Clayton-Matthews, have estimated that this paid leave program will cost workers an average of about $2.31 per week—about the cost of a cup of coffee.
Some critics contend that the cost will be higher, but they appear to misunderstand that paid leave would be allowed only for serious medical conditions, not merely because a worker has an aging parent who can use some help around the house. California’s experience confirms that a carefully structured program will not cause a mass exodus of employees—on an annual basis, only about 1 percent of workers there have used that state’s paid leave program to care for a new baby or sick family member.Taken together, our proposals for tax cuts and paid family and medical leave would help Massachusetts recruit and retain the most talented employees in the world, while also addressing the human needs of working families who face the joy of a new baby or the pain of a serious injury or illness. Many of us take these benefits for granted. But for too many working families, the system today does not work. We can and should provide support for strong families, in a way that strengthens our entire economy.
Robert E. Travaglini is president of the Massachusetts Senate.