Minnesota DFL legislators are pushing a massive mandatory family leave bill that amounts to a huge economic experiment — which is to say gamble — that threatens jobs and hours available to workers.
House File 2 comes with an estimated startup cost of up to $1.7 billion , but nobody really knows what the tab will be. That’s because legislators haven’t yet done an actuarial study — the only reliable way to project costs.
In classic cart-before-the-horse fashion, the bill’s supporters envision an actuarial study after passing legislation that has failed several previous attempts, if the DFL’s control of both chambers allows them to do so.
Here’s what we do know: The mandatory family and medical leave bill would likely be the most generous in the nation, requiring all employers, large and small, to provide up to 12 weeks of medical leave and another 12 weeks of parental and family leave.
If a worker were to use all 24 weeks, it would amount to a whopping 44% of work days in a year.
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Not surprisingly, no other state comes close to providing that much time off for medical or family leave. Because of the cost and complexity of these leave programs, only 11 states offer them.
Employers already are struggling to get by with a labor shortage. This mandate, if passed, would only exacerbate those problems.
The legislation is extremely vague in defining those eligible for family leave — expanding the definition of “family” to include taking time off to care for a neighbor, expansive language that drives up the cost.
The problems are especially acute in border cities like Moorhead, where some employers have workers in locations on both sides of the Red River, meaning that they would somehow have to juggle two sets of leave rules.
It’s easy to see that some of those employers would find themselves forced to offer the same or similar leave opportunities for workers in North Dakota, or risk morale problems or seeing workers quit.
Employers — including nonprofits, who also would be subject to the mandatory program — are understandably worried about what the leave program would do to their competitiveness.
This mandatory leave program also would require a massive bureaucracy to manage. The Minnesota Chamber of Commerce estimates that the state would have to hire 300 new employees to run the cumbersome apparatus.
If saddled with the leave requirements, some employers might be forced to trim other benefits — or cut positions. After all, the money must be found somewhere.
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About 80% of the businesses belonging to the Minnesota Chamber of Commerce offer some kind of leave benefit — but, so far as is known, none, even major corporations with generous benefits, would qualify under this leave requirement.
Business leaders have said a more reasonable leave program would provide six weeks of medical leave and six weeks of parental or family leave, a narrower benefit that aligns with the federal Family Medical Leave Act .
We understand the impulse to help workers and their families. This proposal, although well-intentioned, would be a disaster that would be one more drag on Minnesota’s business climate.
Some state leaders are seduced by an enormous budget surplus, now projected at $17.5 billion, but are losing sight of the fact that Minnesota’s high tax climate is hampering business development, and contributing to workforce stagnation — the very opposite of what this wrongheaded policy seeks to accomplish.
The Minnesota DFL should go back to the drawing board and scale back this exorbitant leave policy and come up with something more realistic.
The Trust Project
