Paid Family and Medical Leave Tax Credit Extension and Enhancement Act: Is it Paid Leave?

Senator Deb Fischer (R-Neb.) is correct: “Americans shouldn’t have to choose between making ends meet and taking care of family.” And so is Senator Angus King (I-Maine): “no one should have to choose between caring for our families or receiving the next paycheck to put food on the table.” However, the recently introduced bill sponsored by both senators, The Paid Family and Medical Leave Tax Credit Extension and Enhancement Act, appears to provide more cushion for businesses – not the pathway to universal, comprehensive paid leave that we all need.

In today’s working environment, everyday people are one step away from sickness or caregiving needs which could cause job loss, leading to an economic catastrophe. The recent bipartisan attention to paid leave deserves to be commended, but we can’t ignore the need for real paid leave, not tax breaks.

History shows that incentivizing companies to offer paid leave at their discretion simply does not work. Senators Fischer and King’s paid leave tax credit proposal, originally adopted in 2017, is not widely used and served only as a stopgap measure. Even with the recently proposed changes, this bill still does not replace the universal, federal paid leave program that we need.

Right now, larger businesses with higher revenue use the existing tax credit most, not the small businesses that need paid leave funds to compete. From July 2020 to June 2021, 88 percent of paid leave tax credits went to firms with over $1 billion in revenue. Not only is the money going to huge companies, but there is no way to know if this credit expands access to new benefits or simply offsets existing costs of the paid leave they already provided.

Working people and small businesses need real, comprehensive paid leave, not tax credits that end up supporting mainly big businesses. At Family Values @ Work, we know what effective paid leave looks like from our more than two decades of advocacy as a Network. Fourteen states, including D.C., have passed comprehensive, permanent paid family and medical leave programs. Working while sick, or not having the ability to care for a loved one or to heal from sickness, hurts the workforce. It is time for federal action on a comprehensive paid leave program that allows everyone to take the time they need to care regardless of their income, job title, or location. Join us in the movement to make paid leave for all a reality. A federal paid leave program is what we deserve so that we can all work in dignity regardless of income, job title, or location.