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This legislation would amend the workers’ compensation law to provide relief for small employers from the enormous administrative, regulatory, and financial burden of complying with New York’s comprehensive paid family leave (PFL) law by raising the employee threshold for coverage from “more than one” to “more than twenty-five (25) employees.” The Business Council of New York State, on behalf of its more than 2,400 members, supports this bill.
While it’s true that the law requires 100% of the salary replacement costs to be paid for entirely by employee contributions towards a PFL policy, the administrative cost and burden of correctly administering this benefit will be impossible to bear for many small employers.
Many provisions of PFL mirror the federal Family and Medical Leave Act (FMLA), a law implemented in 1993. At that time, Congress made clear that the administrative burdens of complying with such a complex law were not feasible for small businesses. Congress, in fact, decided that employers with less than 50 employees would be incapable of complying with the myriad of regulations, definitions, terms and conditions of the law. Congress was right. No labor law has been litigated more since its inception than the FMLA.
New York’s PFL is arguably even more complicated to administer correctly than FMLA. From determining full and part time employees “days worked” and “average weekly wage” to obtaining “medical certification” and interacting with income replacement insurance providers - small businesses will struggle to adequately comply with the recordkeeping requirements of the new law. There is a substantial cost to small employers in time required to administer the law, and failing to comply – even unintentionally – has severe costs in the form of fines and penalties. This will dramatically increase the cost of doing business for these small employers making it even more difficult to compete and be profitable.
Raising the employee threshold to 25 or more employees – as S.4336 would do - will help those small businesses most vulnerable to these added costs. For these reasons, The Business Council of New York State supports this legislation and urges its enactment.