Connecticut Democrats have made implementing a paid family medical leave bill a top priority this session, and a committee bill is set to receive a public hearing before the Labor and Public Employees Committee today.
The FMLA program would be funded by a payroll tax paid by employees, however, according to a provision in the bill, that tax could be increased without a vote by state lawmakers.
The bill would levy a .5 percent payroll tax on employees, which would go to a Family and Medical Leave Trust Fund. Employees could take up to 12 weeks of family medical leave with payment up to $1,000 per week. The legislation would be applicable to any company with one or more employees.
In the past, critics of the bill have pointed out the .5 percent tax on employees would not be enough to adequately fund the program, rendering the program insolvent from nearly day one.
But the committee bill up for debate would allow the administrator of the FMLA program to increase the tax even if lawmakers do not hold a vote to increase that tax.
According to the bill, if the Department of Labor – the “administrator” of the FMLA trust fund — determines the fund is no longer solvent, it can raise the payroll tax.
The General Assembly can only reject the tax increase with a 3/5 vote. However, if no vote is held, the tax will be “deemed approved,” and pass.
The “deemed approved” language is criticized in written testimony submitted by Yankee Institute.
“This bill would allow future tax increases on state residents without any vote by the legislature. We cannot state strongly enough that we do not believe lawmakers should give away their taxing authority to an administrator. Nor do we think it is good policy to require 3/5 vote by lawmakers to vote down a tax increase,” Yankee Institute wrote.
It would not be the first time Connecticut has used “deemed approved” language to allow state laws and policies to pass without a legislative vote.
Until 2017, labor union contracts with the state did not require a vote in either the House or Senate to pass. If the legislature did not vote on a union contract within 30 days it was “deemed approved.”
This policy allowed 124 collective bargaining agreements to pass into law without a vote in either chamber between 1991 and 2017, although the policy changed as part of the 2017 budget agreement.
This year’s FMLA bill is the latest in a multi-year push by Democrats to institute a paid FMLA program in Connecticut, and the idea — although not the specifics of the bill — has the backing of Gov. Ned Lamont.
In a press release on Wednesday, Lamont reiterated his support for the program. “We know working families are the backbone of our state. If they are not financially stable, Connecticut will never be.”
However, the paid FMLA bill has been opposed by businesses in the past, including the Connecticut Business and Industry Association, which has pointed out the program would be underfunded from the beginning and require the payroll tax to be increased.
Available written testimony submitted to the Labor Committee regarding 2018’s bill shows the Lumber Dealers Association of Connecticut and the Connecticut Food Association also opposing the program.
Although there is not a fiscal note attached to the bill yet, similar bills considered in the past included a start-up cost of $13.6 million and $18.6 million in yearly costs.
Under the committee bill up for public hearing, a covered employee would be anyone who has earned more than $2,325 during any quarter within the past five calendar quarters.