Bipartisan Paid Parental Leave Plan Proposed in Senate as Oregon Enacts Paid FMLA Law

August 16, 2019

Senators Bill Cassidy (R-LA) and Kyrsten Sinema (D-AZ) released a paid leave proposal that would allow new parents to immediately receive $5,000 through the child care tax credit.

The bipartisan Senate plan would allow new parents to receive $5,000 right away in exchange for a reduced child care tax credit of $1,500 per year for 10 years.  Low-income parents who pay less in taxes and are not eligible for the full child care tax credit would be able to receive 12 weeks leave with full wage replacement in exchange for a smaller reduction to their taxes over 15 years.

Two other Senate GOP plans would provide paid leave through early access to Social Security benefits in exchange for delayed or reduced retirement benefits later, while Democrats continue to call for passing the FAMILY Act, which would establish a federal insurance program similar to those that exist in some states.

Oregon’s new paid FMLA law will provide, beginning in 2023, 12 weeks of paid leave for a new child, medical illness, or caregiving needs.  The program will be funded by both employers and employees, with businesses contributing 60% and workers 40% through a payroll tax.

  • Oregon will be the first state to provide low-income workers with 100% of their wages while on leave.

Outlook:  While the Senate is unlikely to take up any paid leave bill, the House will likely pass the FAMILY Act to tee up the issue for the 2020 presidential campaign.  Meanwhile, new state laws will continue to be enacted.