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New York set to institute most aggressive paid family leave act in the nation

At UncommonGoods in Brooklyn, New York, workers bringing home a new child or facing challenges caring for a sick loved one don't need to make tough decisions in choosing work over family. The small business, which is an online and catalog retailer of unique products, with some 200 employees, has a paid family leave policy in place, offering up to eight weeks of paid time off per year.

CEO David Bolotsky says the policy isn't just good for workers — it's good for his bottom line.

"It's important because families are important, and being able to care for loved ones is essential," Bolotsky said. "Providing our workers with the ability to balance their personal needs with their work requirements, we think, is in our business interest as well."

Come Jan. 1, all businesses in the state will have policies that look much like what workers have access to at UncommonGoods, as New York implements what's being hailed as one of the most progressive paid family leave policies in the nation.

The program will be phased in over the next four years, allowing up to 12 weeks of paid time off by 2021 for a new child. The new measures apply to adopted or foster children, as well as ill family members, including children, in-laws and domestic partners. Those who are experiencing family pressures when someone is called to active military service also qualify.

The payment of benefits is funded through a payroll deduction, so the burden is on workers and not employers to cover costs.

What's more, all businesses in the state, regardless of size, will have to comply. This is different than the federal Family Medical Leave Act, which guarantees up to 12 weeks of unpaid leave to workers at businesses with 50 or more full-time workers — which advocates say is key.

Dave Bolotsky, founder and CEO of Brooklyn-based Uncommon Goods, offers a coveted family leave benefit for employees.
CNBC
Dave Bolotsky, founder and CEO of Brooklyn-based Uncommon Goods, offers a coveted family leave benefit for employees.

"Paid family leave is good for all businesses in New York, no matter what the size. Studies show it helps businesses maintain and retain their greatest resource: employees who have been proven to be more productive, with improved morale knowing that they have the security to remain in the workforce even during brief periods when their families need them. Job security is a core principle of the law, and it is good for business because employers benefit from the gains in productivity, morale and retention," Don Kaplan, deputy director of communications for Human Services at Gov. Andrew Cuomo's Office, said in a statement.

"Paid family leave is good for all businesses in New York, no matter what the size. Studies show it helps businesses maintain and retain their greatest resource: employees." -Don Kaplan, deputy director of communications for Human Services at Gov. Andrew Cuomo's Office

New York is one of five states nationwide to implement such a policy. Despite a push from President Donald Trump's daughter and adviser Ivanka Trump on passing a federal paid family leave law, there's been little action on the issue. As a result, state and local governments are taking action themselves to bring about change, much like what's happened with minimum-wage laws nationwide. And while the focus for many small companies has been on health care and tax reform in Washington, experts say family leave should be on the radar.

"If you look at the details, it's actually very complex, with a lot of nuances, with a lot of monitoring, with a lot of reporting going on," said Frank Fiorille, vice president of Risk Management, Compliance and Data Analytics at Paychex, an HR solutions company. "It's something small businesses do need to be aware of, and could be very complex to comply with."

A challenge for some small businesses

Some Main Street advocacy groups disagree with the move in New York, saying its inclusivity places an unfair burden on small companies.

"Administratively, it's going to be challenging for them and especially for smaller companies. If it's a key person or a very important member of the staff, they're required to permit them to take this leave," said Heather Briccetti, president and CEO of the Business Council of New York State, which opposes the law.

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While Bolotsky does acknowledge the challenges smaller companies may face as the law phases in, he says in his experience the policy has proved to be a worthwhile undertaking.

"In the short term, it gives employers less flexibility, and there's a cost associated with it. It is something that will increase taxes, so there's a financial burden with it," he said. "But I think parents being with their children is actually a good investment. It's been proven to help with child development. There's a positive long- term investment. ... It's the right thing to do."