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For Release — March 25, 2015

Business Council opposes paid family leave proposals in testimony to Senate Labor and Social Services Committees

ALBANY, N.Y.—Speaking before a joint hearing conducted by the Senate Labor and Social Services Committees, Ken Pokalsky, vice president of The Business Council of New York State delivered testimony in opposition to paid family leave proposals.

“The Business Council believes it is important to allow employers to fashion their overall leave policies based on their own circumstances and capabilities, and within the context of company-specific compensation plans,” Pokalsky said. “Mandatory leave legislation imposes one-size-fits all requirements on employers, regardless of company-specific capacity for employee compensation and workforce flexibility.”

In his testimony, Pokalsky cited the increased cost to employers at a time when the Upstate economy lags behind downstate.

“There is a false impression that the private sector economy is uniformly strong across the state. The numbers tell a different story,” he said. “While job growth in New York State has exceeded national levels over the past decade - 7.5 percent in New York versus 4.5 percent nationwide – job growth within the state has been very uneven. In short, with much of the state still experiencing relatively slow economic recovery and ongoing job growth challenges, we believe it to be counter-productive to impose new labor cost mandates on the private sector.”

Business Council estimates prepared by insurance actuaries indicate that employers’ temporary disability insurance costs would increase between 1.5 and 3 times current rates.

“This projection does not reflect the fact that people are more likely to go on disability with increased benefit levels. For the increased disability benefit plus the paid family leave component, assuming the incidence of leave will increase by a percentage similar to California, the range of increase is 2 times to 3.5 times of the current premium,” said Pokalsky.

The Business Council also notes that a paid leave mandate would impose a burden on New York employers not generally found in other states.  According to the National Council of State Legislators, only three states - California, New Jersey and Rhode Island - currently implement mandated paid family leave programs.

The Business Council's complete testimony is available here.