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McBride plans revised paid leave bill SB1

Katie Tabeling
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State Sen. Sarah McBride is planning revisions of Senate Bill 1, paid family and medical leave, after hosting town halls with Delaware businesses and residents. | DBT PHOTO BY JACOB OWENS

DOVER — After months of conversations with advocates and business leaders, State Sen. Sarah McBride (D- Wilmington) is preparing a revised version of her proposed paid family and medical leave bill.

McBride confirmed she is amending the proposed Senate Bill 1 to reflect the feedback she has received after a eight-month tour across the state, which included town hall events and meetings with state and local chamber of commerce members.

While she is still finalizing the language, McBride said the revised SB1 will address where seasonal and part-time workers qualify, revising the definition of a “family” and how long an employee must work before becoming eligible, and more.

The revised paid parental leave bill may be filed by the end of the month.

“We know that these programs work in other states. We know that they’re popular among the broader public and business owners alike, and that’s why I’m so passionate about this,” McBride told Delaware Business Times. “But despite the fact that I believe SB1 is good for workers and good for businesses,  I’m certainly someone who seeks to be an inclusive legislator and I’m incorporating the feedback I have heard.”

SB1, as proposed last May, would require employers to offer 12 weeks of paid family and medical leave through a state social insurance program. Under the bill, eligible Delaware workers could receive up to 80% of their average weekly wages through the state-run insurance program.

In the proposed bill, the labor department would collect a paid leave premium of 0.8% of an employee’s gross wages, and employers can split those contributions evenly with their workers. Businesses with fewer than 20 employees can opt out of the employer portion, but their workers will still be eligible for paid leave through the state program.

The U.S Bureau of Labor Statistics data found that less than one in four American workers have access to paid family leave in 2021.

When the 151st General Assembly concluded its first of two years, SB1 had yet to see a committee or floor vote. But Gov. John Carney signaled he would sign paid parental leave into law during his State of the State address Thursday, marking his first show of support after calling the issue “complex” last year.

“Supporting businesses also means supporting the employees who work there. We know workers are not just looking for a job. They’re looking for a way of life, especially as they start a young family,” the governor said. “[Paid leave is] the right thing to do and it will make Delaware more attractive for younger workers.”

The Delaware Cares Coalition, which has been backing expansion of paid leave in the state along with McBride, applauded Carney for endorsing SB1, noting that paid leave will “lift up all Delawareans,” including businesses and families.

“Over 50 Delaware organizations came together to support this policy because we believe no Delawarean should be forced to choose between their job and their family,” Delaware Cares Coalition Director Liz Richards said. “Paid family and medical leave is a key part of the solution as we rebuild through this pandemic.”

Most of the state’s most influential business associations remain wary of the proposal though. 

The Rehoboth Beach-Dewey Beach Chamber of Commerce recently surveyed its membership about SB 1 as written, and 57 participants — or 4% of the total membership — responded. The majority of respondents did not agree how family was defined in the bill or who would be eligible for the program. Nearly 90% were concerned that the seasonal staff that makes up the bulk of dozens of the Rehoboth Beach’s workforce would apply.

In SB1, the bill defines a “covered individual” as an employee who earned at least $2,500 in wages from covered employment during the 12-month period before filing for leave.

Almost 90% of Rehoboth and Dewey Beach businesses surveyed  believed 80% of repayment was too high, and expressed concern that it would not include bonuses or tips in its calculation.

McBride countered that the 80% was dependent on wages, so it would be scaled for how long each employee worked per week. She added that the proposed bill also caps the leave payment to $900 a week.

“The reality is, for this to be a practical benefit for workers — particularly lower wage workers — it needs to be a meaningful percentage of their wages,” she said. “A lot of Delawareans could not afford to live off less than 80% of their income for any kind of period of time. If the choice is between working full-time and getting cancer treatment on starvation wage replacement, that’s not a choice at all.”

The Rehoboth Beach-Dewey Beach Chamber of Commerce has yet to take an official stance on the bill, as the board of directors is waiting to see the revised version. 

That organization is not alone, as the Delaware State Chamber of Commerce opposed the bill as written last year and are awaiting the revised version before revisiting their official stance, officials said.

The DSCC voiced concerns last session in a letter to McBride regarding the coverage, eligibility factors and implementation of the law. It recommended raising the threshold for businesses eligible to opt out up to 35 employees, better defining and limiting who would be eligible for the benefits, and potentially phasing in the 12-week benefit over several years.

On Thursday, after hearing the governor’s support, Mike O’Halloran, state director for National Federation of Independent Businesses, also voiced concerns over SB1.

“Gov. Carney was right to highlight the $400 million his administration provided for struggling small businesses through various grant and loan programs during the pandemic. Unfortunately, his support for a costly state-run program paid for by a new payroll tax on small business owners and their employees will undermine his administration’s efforts to help Delaware’s job creators recover from this economic crisis. Senate Bill 1 creates a new fixed labor cost, and that will serve as a deterrent, not a catalyst, to solving our state’s labor shortage,” he said in a statement.

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