District of Columbia moves toward European style paid parental leave

Whenever we hear a story about a new policy proposal or social program coming out of Washington, D.C. we tend to assume that it’s a bit of federal policy which applies to the entire country. This isn’t one of those stories because it actually applies to the local government of the District of Columbia. (At least for now.) A new piece of legislation is hitting the floor of the city council this month and if it makes it onto the books it will set up the District as one of the most generous, European style locations in America in terms of employee benefits for families, while delivering a financial shock to the system for business owners. (Washington Post)

The District would become the most generous place in the country for a worker to take time off after giving birth or to care for a dying parent under a measure supported by a majority of the D.C. Council.

Under the legislation that will be introduced Tuesday, almost every part-time and full-time employee in the nation’s capital would be entitled to 16 weeks of paid family leave to bond with an infant or an adopted child, recover from an illness, recuperate from a military deployment or tend to an ill family member.

The broad new worker benefit, enthusiastically supported by the Obama administration, would be paid from a fund created by a new tax on D.C. employers. The benefit would dwarf family-leave assistance in all 50 states and would also mark a step toward benefits offered by most European countries, where parents can take as much as a year of paid time off following the birth of a child.

I’m still waiting to see the full details because we need to find how precisely how many businesses this will apply to. The advertising for the plan states that “almost all D.C. employees would be eligible” with the exception of out of District residents and employees of the federal government. There doesn’t seem to be any exception for small businesses.

The plan is apparently being kicked off with the help of a federal grant program which Labor chief Thomas Perez has been bragging will serve as a way to short sheet Republicans who refuse to raise the federal minimum wage. But once the initial launch is complete, the program would be funded by (wait for it…) a new tax on all employers. Business owners would have to kick into a general fund to pay for the periods of leave. This not only drives up the cost of doing business, but will leave employers with the task of finding (and paying) temporary workers to fill in for a third of the year every time a new child is born or adopted, or when an immediate family member falls terminally ill.

To be sure, this is a great deal for employees who find themselves facing tough times or the expansion of their family, but the D.C. Chamber of Commerce has already warned that these policies are going to make the District dangerously “noncompetitive” as compared to their neighbors in Virginia and Maryland. It definitely sounds “European style” to me, but given the state of most of Europe’s finances these days, is that something we can truly afford to emulate? And the larger story here is that this program is an obvious test balloon for the Obama administration as they try to drive Hope and Change at the state and local level after failing to convince enough members of Congress as to the wisdom of their policies.

This may be coming to a city or state near you soon. Business owners should brace for impact because this sort of government thumb on the free market scale never ends well.

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