New Jersey among handful of states to take progressive stance toward paid family leave

Gabrielle Saulsbery//August 13, 2018

New Jersey among handful of states to take progressive stance toward paid family leave

Gabrielle Saulsbery//August 13, 2018

Steve Wood was there for nearly every milestone in the first 12 weeks of his son’s life. And as he got to bond with his first child, his relationship with his wife Lizzy grew stronger, enabling the couple to equitably share parental duties.

Wood was better able to partner with his wife to negotiate the frenzy of parenthood thanks in part to his employer Internet Creations’ new paid family leave policy. He was the first employee to take advantage of the policy that was introduced in February, just two months before Lizzy gave birth.

“When we were a small company, it was easy to just take care of employees’ individual needs and what they needed to support their personal situation,” said Glen Wilson, Internet Creations’ director of talent, who helped implement the policy at the Hamilton-based IT consultancy. “As we approach 50 employees – and we’re looking to go beyond that – we recognized the necessity to lay out our intentions on paper.”

The policy creation and review process started as a fact-finding mission, with a group of employees looking into the policies of some of the top-rated places to work in New Jersey and seeing what the options were for paid leave. Additionally, they weighed how a variety of federal, state and local laws might impact their policy. For example, they looked at the New Jersey Law Against Discrimination, Americans with Disabilities Act and local paid leave laws.

“It was important we took a lot of things into consideration and gave everybody the right options. And that people were being treated equally across the board,” Wilson said. “Some plans might treat you differently based on your role or tenure. This one does not.”

Family Leave Insurance, guaranteed to all employees in New Jersey who worked 20 hours and earned at least $169 per week in the 52 weeks immediately preceding leave, or to all employees who made at least $8,500 during that time, allows for six weeks of paid leave to care for a newborn or adopted child or a sick family member.

The state implemented the program in 2009 and through 2017, it had supported 251,418 qualified workers. Last year alone, NJFLI covered over $85.3 million in claims. All employees in the state pay into NJFLI, which costs about $30.33 per year per employee whether they take it or not.

New Jersey was the second state to adopt a paid family leave program after California. New York, Rhode Island and Washington, as well as the District of Columbia, have since enacted similar legislation.

Family leave programs go beyond parental leave, yet even today, few states have either.

The 1993 Family Medical Leave Act requires companies with more than 50 employees to allow for unpaid parental leave; however, the U.S. is one of only three countries worldwide without mandatory paid parental leave. Earlier this month, Sen. Marco Rubio, R-Fla., and Rep. Ann Wagner, R-Mo., unveiled legislation that could change that, but until then most employees must take unpaid leave following the birth or adoption of a child.

New Jersey’s paid leave plan isn’t perfect. The maximum pay allowed per claim is $637 a week, which prompted companies like Internet Creations to implement its own policy.

“It’s not bad, but it’s still too low for a lot of people. If you’re a low-wage worker, you’re still only getting two-thirds of what you take home,” said Karen White, director of Rutgers University’s Working Families Program in the School of Management and Labor Relations. “For someone making $300 a week and having that cut by $100, that’s a lot to be cut and they can’t afford that. When you’re living to the last penny that you earn on a weekly basis, having to take home any less than you would normally is very hard.”

Without the full pay offered by Internet Creations’ leave plan, which thus far is entirely company-funded, Wood said that he likely would have had to take less time off after his son Greg was born.

The plan at Internet Creations allows for 320 hours that can be taken in two ways. An employee can take his or her leave consecutively for eight weeks, or over 12 weeks with a ramped return: five days off for the first four weeks, three days a week for the next four weeks and two days a week for the remainder.

Though Wilson and company founder Chad Meyer wanted to give employees full flexibility with how they took their 320 hours, their lawyer advised having two options was the best plan, Wilson said.

“If Manager A offers one thing to Employee A under the care plan, but Manager B doesn’t offer Employee B the same thing, it opens you up to the possibility of discrimination,” he said. “We want to make sure all staff is treated fairly, and how you do that is adding some structure around it. When we put it out, I think the team understood that.”

Wood chose the ramped option, which allowed him to spend more time with his wife and son and plan ahead for doctor appointments and checkups.

“It also helped me mentally prepare for coming back,” Wood said. “You put 100 percent into this role as a new father [and] it’s not easy to turn that off and come back to your professional duties.”

“Think about it: when you take a vacation, it’s like you need a vacation from the vacation just to catch up on email. It’s a similar mindset. It’s a longer time, though, with many more emails,” he joked.

Meyer said a fully paid family leave plan aligned with Internet Creations’ employee-focused culture.

“It’s not really scientific or mathematical, but I generally think when you do the right thing by your employees, they do the right thing for you and everything falls into place,” Meyer said. “There’s no mathematical formula to prove that, but sometimes my gut is sharper than my mind.”

And he’s right. The National Study of Employers by the New York-based Families and Work Institute found programs like paid leave promote the retention and recruitment of employees and increased worker productivity.

“When you think about the whole life cycle of hiring — posting the job, wages to recruit the person, background checks, everything that goes into the process … then when you think of the time it takes for a manager to onboard, knowledge transfer, loss of knowledge that could have been prevented if someone didn’t leave the door — there’s a lot that goes out the door when you lose someone when you could have kept them,” Wilson said.

Wood said knowing his paychecks would be consistent and his job protected while he navigated his new role as a father led him to feel positive and rejuvenated upon his return to work. And the effects did not end with him.

“It’s not just the employee that gets impacted. The impact on your spouse can’t really be measured either,” he said. “That’s a part of the story that needs to be told as much as possible.”