“We Need Meaningful Paid Leave Policy, Not Giveaways to Wealthy Corporations”
Washington, DC — Today, U.S. Senator Deb Fischer (R-Neb.) and U.S. Representative Randy Feenstra (R-Iowa) reintroduced the “Paid Family and Medical Leave Tax Credit Extension and Enhancement Act,” to make permanent a “paid family and medical leave” tax credit that they claim incentivizes businesses to provide paid leave to their employees.
This tax credit, first passed in 2017 and set to sunset this year, provides a small amount of reimbursement to companies that voluntarily provide leave to their workers, but the leave provided can be as little as two weeks at only a fraction of a worker’s wages. Even with these permissive rules, Department of Treasury data analyzing employers’ utilization of the credit shows that only 1,230 businesses nationwide used this credit in 2020 — and more than 88% of it went to corporations with $1 billion or more in revenue.
Recent polling shows that Americans oppose this policy across party lines. Voters — in battleground states no less — prefer a plan that ensures all workers have paid leave regardless of where they work (68%) over a plan that gives employers tax credits when they choose to offer paid leave (32%) two to one, including a majority of Republicans. Polling also shows small business owners overwhelmingly support (79%) a guaranteed paid family and medical leave insurance program, and would prefer to replace the tax credit with a national program over extending the tax credit. Furthermore, an overwhelming 88% of voters support “closing corporate tax loopholes and using those funds to invest in paid leave” and care, including majorities of independents (81%) and Republicans (79%). Americans want to invest in policies like paid leave for all — they don’t want to gut government and further cut taxes for wealthy corporations and billionaires.
Dawn Huckelbridge, Founding Director of Paid Leave, for All released the following statement on the reintroduced tax credit:
“We applaud bipartisan talks and progress that expands access to meaningful paid leave for more people. This proposal does not do that.
“In America, all working people should be able to afford and care for their families. Our goal — with the broad support of more than 90% of Americans — remains a universal federal paid family and medical leave program, the kind of program has passed on a bipartisan basis and been successfully implemented in a number of states, with strong results for both businesses and families.
“This tax credit has proven ineffective and it is not a paid leave policy — it is simply another means of giveaways to wealthy corporations in our country with very limited reach to working people and their families.
“The United States needs a real paid leave plan that ensures people can care for themselves and their loved ones, and even incremental progress should be evaluated carefully for who it reaches and who benefits.
“This legislation includes no guarantee that any worker will receive paid leave, and it includes no accountability for the public dollars that are spent. Neither the public nor policymakers have any insight into the quality of paid leave provided by the companies claiming the credit, the number of workers helped, or whether the tax credit has supported a newly adopted policy or is simply subsidizing a company for the paid leave it was already providing.
“What’s more, employers can only use the credit if they cover 75% or more of the cost of providing paid leave out of pocket themselves — putting usage out of reach for small business owners who can’t afford the hefty price tag.”
As the small business membership group Main Street Alliance stated, this “proposal from Senators Deb Fischer and Angus King is a step in the wrong direction: enshrining a leg up for big business over small in our tax code when we should be leveling the playing field.”