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July 17, 2000

Council will oppose bills to mandate employer-funded family leaves

The Business Council will oppose any state legislation that would require employers to tap into their unemployment insurance (UI) or disability insurance accounts to provide paid family leave.

Last year, President Clinton directed the U.S. Department of Labor to issue regulations allowing individual states to use their unemployment insurance trust funds to finance paid family leave, said Tom Minnick, The Council's specialist in human resources issues.

That federal agency has issued its final rules permitting states to do this. Those rules take effect August 14, he said.

"Only two years after New York tried to contain its unemployment insurance costs through UI reform, we think it would be unwise to place this new burden on employers," Minnick said.

Two proposals that would impose this new cost on employers have already advanced in the Assembly.

The first bill (A.5167/Nolan) would authorize the payment of New York State statutory disability benefits to non-disabled employees who qualify for a federal family/medical leave.

After the bill was first proposed in February 1999, it advanced from the Assembly Labor Committee to the Assembly Ways and Means Committee, where it remained at the end of the 1999 legislative session, Minnick said.

This year, it advanced further and was put on the Assembly calendar in June. It has not yet passed in the Assembly, however.

A second Assembly bill (A.8994/Nolan) would authorize payment of state unemployment insurance benefits to employees who would otherwise qualify under federal guidelines for family or medical leave, as well as for firms who would be excluded under federal guidelines because of the size of the employers or the employees' length of service.

This bill, which was proposed in July 1999, advanced to Assembly Ways and Means last year but remains in the Assembly Labor Committee this year.

Minnick noted that The Society for Human Resource Management, the United States Chamber of Commerce, and the LPA, a public-policy organization of senior human-resources executives, are suing to overturn the new federal regulations.

"While these new regulations are being challenged in court, The Council will urge Albany not to act unilaterally to get ahead of the federal initiative," he said.