By Angie Brown, Absence Practice Leader
November 11th, 2020
If you know me, you know how excited I was to learn that Colorado voters have passed a Paid Family Leave program! After six long years of failing in the legislature, Colorado has become the first state to pass a Paid Family leave with the citizen majority vote! Eight other states have passed Paid Family Leaves over the last two decades starting with California, albeit all were passed through the legislature. Colorado Paid Family Leave, also known as Proposition 118, will go into effect in 2024.
“I am so proud that Colorado is the first state to do this on the ballot and it shows how incredibly popular and needed this program was,” Sen. Faith Winter told The Colorado Sun on November 3rd, the night of the election.
There will be plenty of nuances that will need to be determined relating to the administration of Colorado Paid Family Leave, but here’s what we know today.
Eligible employees: All working employees who have earned at least $2,500.00 at their job. This includes state employees, those self-employed, and gig workers for companies like Uber and Lyft, who have earned at least $2,500.00 at their job.
Note: Employers with less than 10 employees can choose not to participate, and employers with a more generous offering today will be exempt from participating.
Entitlement: 12 weeks of paid time off to care for oneself or the care of a family member. Leave is also for pregnancy and to bond with a new baby, or an adopted child. Those who face pregnancy or childbirth complications will be eligible for an additional four weeks of paid leave. Family members of active-duty military personnel and victims of domestic violence or sexual assault are also covered by the program.
Benefits: Workers could receive up to 90% of their weekly pay, up to $1,100 per week.
The Colorado Department of Labor will collect funds paid into an insurance pool by both employees and employers and the expectation is that they will split the cost evenly. Both parties would contribute 0.45% of an employee’s wage.
So for an employee who makes $1,000 per week ($52,000 per year), employers and employees would contribute $4.50 per week. The program will start collecting fees in 2023 and pay benefits in 2024.
What Impact will Colorado Paid Family Leave have?
The fact that this benefit was passed by Colorado voters during a pandemic is particularly interesting. Back in March, as the U.S. was experiencing its initial surge of COVID-19 cases, I wrote about how the pandemic highlights the need for a paid leave program. While the federal government passed some temporary legislation with the FFCRA, we haven’t seen the federal or state governments take significant action since. Instead, now we see voters taking matters into their own hands in Colorado.
The facts paint a glaring need for paid leave in our country. One in 4 women go back to work within 2 weeks of delivering a child because less than 20% of Americans have access to any paid leave. Did the pandemic help make a paid leave offering a priority for Colorado residents? Ultimately, employees need to be able to take time off work without fear of losing our jobs when we or a loved one is ill, or when caring for a new child.
The question some may be left with is will Colorado Paid Family Leave hurt small businesses? It’s the same question California faced nearly two decades ago when it became the first state pass a Paid Family Leave program. If California or the other states that have passed legislation in recent years are any indication, it likely won’t have a significant impact on small businesses. In fact, a report found 92% of California employers have had a positive impact or no impact at all because of Paid Family Leave.
Other studies show that by reducing employee turnover and increasing employee morale and productivity, paid leave offerings have a positive impact on businesses and employees alike. While Colorado voters won’t be able reap the benefits until 2024, they took unprecedented action and passed a much-needed program after the legislature failed to for many years.
Good for you, Colorado!