GILROY
– One of Gilroy’s major employers and the Gilroy Chamber of
Commerce are trying to educate people about a state law effective
July 1 that allows workers to take paid time off to care for a
family member.
GILROY – One of Gilroy’s major employers and the Gilroy Chamber of Commerce are trying to educate people about a state law effective July 1 that allows workers to take paid time off to care for a family member.
Chamber Executive Director Susan Valenta said there is some confusion among Gilroy employers about the new law and how it will affect them. Some say it will cost their business slightly more money, hurt employee morale and impact staffing.
“I knew this was coming into effect,” Valenta said. “We have brought this to the attention of the business community several times.”
Paid Family Leave pays up to six weeks per year of benefits to employees who need time off to care for parents, children, spouses and domestic partners or to bond with a new child.
An additional .08 percent was added in January to the amount deducted for State Disability Insurance to fund the entirely employee-funded program.
Inland Paperboard and Packaging handed out pamphlets with its 167 employees’ paychecks last week explaining how Paid Family Leave works. Further, Human Resources Coordinator Denise Sargeant said she expects to hold a plantwide meeting this week to discuss the benefit.
“We’re doing everything, we can to make sure they know about it,” Sargeant said.
Currently, employees at Inland Paperboard and Packaging can take a Family Medical Leave which counts as an excused absence but is unpaid. Approximately 18 employees utilize Family Medical Leave occasionally to take a family member to doctor visits, for instance, Sargeant said.
Starting Thursday, employees will be able to file for a Paid Family Leave. It provides benefits up to 55 percent of lost wages up to $728 per week for up to six weeks in 2004. In 2005, this maximum amount will increase to $840.
“That’s a good thing,” Sargeant said. “You just have to be careful you might have people who try to abuse the system.”
One protection against abuse is that employees must provide their employers with medical information that supports their claim.
Sargeant expects Paid Family Leave to cost Inland Paperboard and Packaging extra money.
“We won’t be able to track it until the end of the year,” she said. “That depends on how many employees utilize it. That would make a big difference.”
Jan Bernstein Chargin, spokeswoman for Gavilan College, said the college doesn’t expect the new law – which doesn’t apply to teachers but to classified and unrepresented employees – to cost anything.
“It shouldn’t really have any effect,” she said. “People already have the right to take leave. It shouldn’t change the number of people who need family leave.”
Smaller businesses are expected to feel the impact of the law the most, said Bill Lindsteadt, executive director of the Gilroy Economic Development Corporation. The change won’t affect the City of Gilroy because its employees don’t pay into State Disability Insurance. Paid family leave is a component of the State Disability Insurance program.
“I think that anytime government lays a mandate on private sector business that’s a hardship for some, and others can afford it,” Lindsteadt said.
Jim Habing, owner of Habing Family Funeral Home, said managing a small business with only three or four employees means he has greater flexibility, and he can try to accommodate each employee’s needs. But if someone takes several weeks of leave, he’d likely have to replace them at least temporarily.
“We can’t put everybody on hold,” he said. “If we’re busy, we’re busy.”
Under the program, employees are not guaranteed their jobs back once they complete their leave.
Steve Sharrer, vice president of human resources for the much larger Saint Louise Regional Hospital, said it’s too soon to tell how the law will impact the hospital.
“We will certainly comply with whatever the law requires us to,” he said.
Assemblyman Simon Salinas, D-Salinas, voted in favor of the legislation in 2002.
“After hearing the debate and argument, it came down to a decision that parents have to make about choosing about caring for a critically ill child or spouse versus putting food on the table,” Salinas said.
If it works as planned, Salinas said the program will lead to a healthy work environment where people know their employer is going to be supportive of their needs.
The state likely will have to monitor the benefit to make sure it’s not abused, he said. But Salinas thinks most of the claims will be legitimate because workers are paid for only up to half their salary and must provide proof of a family member’s illness.
“Most employees want to get back to work and want to do their jobs,” Salinas said.
The Chamber of Commerce had several concerns with the law before its passage, Valenta said. Among them were:
• It could place a burden on the state’s disability insurance fund, if the anticipated funding for the program would fall short of the actual demands.
• It provides the same leave benefits to part-time workers as to full-time workers.
• It makes California the only state to have a Paid Family Leave law.
• It includes no time-on-the-job requirements. A worker just hired can take up to six weeks of paid time off to care for a family member despite only one day of employment.
What the new law amounts to is forced taxation, Lindsteadt said.
“My belief is that if a company wants to provide it they should, if they don’t then they shouldn’t be forced to,” Lindsteadt said.
Paid family leave
What is it?
Law passed in 2002 to extend disability compensation to workers who take time off work to care for a seriously ill child, spouse, parent or domestic partner or to bond with a new minor child
Who can use it?
Workers covered by state disability insurance
How much are the benefits?
Weekly benefits range from $50 to $728 for claims beginning July 1. They pay up to 55 percent of an employee’s full salary
How long can I get benefits?
Six weeks within any 12-month period
When does it go into effect?
July 1
How is program funded?
Employee contributions into State Disability Insurance
Source: California Employment Development Department (www.edd.ca.gov/eddmail.htm or 877-BE-THERE)
