Testimony on Paid Family Leave at joint New York City Council Hearing

Nancy Rankin

Testimony by
Nancy Rankin, Vice President for Policy Research and Advocacy
Community Service Society of New York

Before the Joint Hearing of the New York City Council
Committee on Civil Service and Labor and the Committee on Women’s Issues
April 20, 2015

Thank you for the opportunity to testify today in support of several proposed actions that would help raise the incomes of New York City’s working women and low-income families.  These measures include resolutions calling upon the State to enact paid family leave and to grant New York City the authority to set its own minimum wage, as well as local legislation to create an Office of Labor Standards and protect workers who share wage information needed to uncover and fight wage discrimination.  Not only would these actions bolster family earnings, they would drive economic growth by increasing spending at local businesses and enabling women to fully participate in the labor market.

My name is Nancy Rankin. I am Vice President for Policy Research at the Community Service Society of New York, a nonprofit organization that works to advance upward mobility for low-income New Yorkers.  Today, CSS continues its remarkable 172-year legacy in using rigorous research to drive changes in public policy to combat poverty and economic inequality.

Paid family leave is an economic necessity for all working families in New York State, but especially for working women struggling to survive on low wages. They cannot afford to take unpaid leave or risk losing their jobs when a new baby arrives, an aging parent survives a devastating stroke, or a child is stricken with cancer.  According to the latest BLS statistics (March 2014 National Compensation Survey), a mere five percent of workers in the bottom wage quartile have paid family leave from their employers.  Because many are working for smaller employers, they do not even have federal FMLA protections of unpaid family leave.

In New York City, one out of four working women lives in a low-income household. That’s close to half a million working women, scraping by on less than $38,000 for a family of three. Almost two-thirds of them are black or Latina.  Their jobs and earnings are essential for keeping both their families afloat and the local businesses where they shop and work thriving.

Some will argue workers could use saved up vacation and sick days to deal with family needs.  But that ignores the stark reality that half of low-wage workers do not get any paid vacation according to 2014 BLS statistics.  While the Council can take pride that legislation it passed in 2013 and 2014 have ensured that all workers have access to sick leave, those five days are for routine illnesses, not the extended time needed to care for a newborn or seriously ill family member. Low-paid workers are unable to save anything from their inadequate wages to sustain themselves and their families for days, much less weeks, without a paycheck. According to CSS’s latest annual Unheard Third survey, close to half (46%) of low-income working mothers in New York City have $500 or less to fall back on in an emergency. For someone earning the current minimum wage, seven days lost pay would entirely wipe out their life savings.

When critical family needs trigger job loss, a low-income family’s hardships skyrocket. CSS’s survey found that among low-income households reporting job loss, the proportion failing to meet their rent doubled, and the number unable to fill a needed prescription shot up to 38 percent from 18 percent.  Compared to low-income families that did not experience job loss in the past year, those that did were 25 percent more likely to report being on Medicaid and 32 percent more likely to receive food stamps. 

CSS recently conducted a series of focus groups with low-income new moms. They told us of feeling pressured to return to work, in some cases in as little as two weeks after giving birth, for fear of losing their jobs and worries over mounting bills.  As one young mother put it, “I’m petrified I’m going to lose my job.” Another described her anxiety about falling behind with Con Edison and other payment plans, “I’m constantly in fear, waking up in the middle of the night.” Almost none of the new mothers were informed by their employers, as required by law, of their right to Temporary Disability Insurance benefits, which even though inadequate in duration and amount, would have provided at least some help.

As an immediate step, the Council should consider actions that can be taken even ahead of passage of paid family leave to ensure that pregnant working women in the City are aware of their existing rights to FMLA leave, to reasonable accommodation at their workplace during their pregnancy and to the few weeks of minimal TDI benefits we currently have.  For example, can medical providers treating pregnant patients be encouraged or required to provide a basic guide developed and distributed by the City?  Can the City create an app for pregnant New Yorkers?

Beyond this outreach to raise awareness of laws already on the books, we need to make New York the next state to provide paid family leave. Modernizing our existing Temporary Disability Insurance system is a smart, affordable way to provide paid family leave. It makes sense to build on this statewide system, as the Council resolution urges. Three of the other five TDI states—California, New Jersey and Rhode Island—have already moved forward to provide paid family leave. To be meaningful, however, benefits must be adequate. The current TDI cap of $170 a week, frozen since 1989, lags dramatically below every other TDI state. So we need to gradually raise the maximum concurrently for existing purposes and paid family leave to half the statewide average weekly wage. Under the legislative proposal supported by the City Council’s resolution, workers would receive two-thirds of their own weekly wage, up to this cap of about $600.

Concerns have been raised by some upstate business groups that paid family leave could have a negative impact on business.  But studies of the experience in California and New Jersey show just the opposite.  Eighty-seven percent of employers surveyed in California said that their state’s program had not resulted in cost increases.  A program that helps workers pay their bills while they care for an infant or seriously ill family member allows employees to return to work feeling more productive and committed to their jobs, grateful that they were able to meet their family responsibilities. But we need not look all the way to California, we can look right here to New York City, where very similar concerns were raised that requiring small businesses to provide paid sick days would be a “job killer”. What’s happened in the year since paid sick time went into effect? New York City has experienced record job growth and is the strongest local economy in the state according to a recent report from the New York Federal Reserve Bank.

Fortunately, New York is poised and ready to become the next state to provide paid family leave.

  • Not only do we have a TDI program already in place as the foundation, but 
  • We have the Cuomo administration’s own Medicaid Redesign Team that made enacting paid family leave one of its top three priorities in its October 2014 report.  This respected group of statewide leaders, that I had the honor of being part of, cited ample research showing the benefits to maternal and child health, as well as projected long run savings from improved health outcomes, averting job-loss induced Medicaid enrollment, and reducing hospital readmissions by enabling family caregivers to assist with increasingly complex post-discharge needs. 
  • And we have widespread public support.  Eighty-four percent of New York City adults polled in a 2014 CSS/Lake survey support modernizing TDI to provide paid family leave. Most striking is the growing intensity of that support; two-thirds now strongly support the idea, up from 42 percent a decade ago. Support crosses party lines with 89 percent of Democrats, 83 percent of independents and 65 percent of Republicans all favoring paid family leave legislation. 

Paid family leave is an idea whose time has come. 

Along with paid family leave, of course, workers need to earn adequate wages.  But what is even minimally adequate varies tremendously depending on where you live. In 2003, two U.S. cities had higher local minimum wages, but since 2012, 18 additional cities and counties have established local minimum wages. Allowing New York City to set its  own minimum wage to better reflect the high costs of living in New York City in comparison to rural upstate towns makes sense and enjoys widespread public support. Community Service Society’s latest annual survey found that three-quarters of city residents polled favor the idea, including 64 percent who do so strongly. 

Community Service Society also endorses the proposal to establish a city office of labor standards. As someone involved in the effort to pass paid sick days, I recall the challenges faced in figuring out which city agency would be appropriate to enforce it, given the absence of a local labor department. The Department of Consumer Affairs has done an impressive job implementing the city’s new paid sick leave law, including spearheading a robust outreach effort. However, as we consider adopting other laws, including a local minimum wage and the wage transparency act, it would be better to have an agency with a clear focus on labor to administer and enforce these measures.

Taken together, these resolutions and bills will do much to address economic inequality now and in the next generation of New Yorkers.

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