In 2008, New Jersey became the second state to enact a Family Leave Insurance (FLI) program. Initially, leave Insurance offered up to 6 weeks of paid care leave. Employees could take paid leave to care for a newborn, within 12 months of birth; to care for a newly adopted child, within 12 months of placement; or to care for a family member with a serious health condition.
The definitions of qualifying “family members” and “serious health conditions” are similar to those employed by the Family Medical Leave Act (FMLA) and N.J. Family Leave Act (NJFLA). Leave could be taken concurrently or intermittently. The benefit amount was based on an employee’s average weekly wage or how much was earned in the eight weeks immediately before a claim began.
FLI is actually an extension of the state Temporary Disability Insurance Act and applies to nearly every private sector employer regardless of size.
When FLI was enacted, the president of the N.J. State Chamber of Commerce said that the program was “a nail in the coffin for New Jersey small business.”
But in a survey conducted by the Employers Association of New Jersey (EANJ) in April, 2019, it appears that small businesses are not burdened by the law and that many employees are not even aware of it.
But from 2010-2017, the amount of FLI claims filed by employees per year amounted to only about one percent of the private-sector workforce. In 2017, with a civilian private-sector labor force approaching 3.5 million, only about 36,000 FLI claims were filed.
In April, 2019, EANJ surveyed a cross-section of its members to evaluate their experiences with FLI and what they were anticipating with FLI’s recent expansion, which includes:
- Increases FLI benefits from 6 to 12 weeks for any period of FLI commencing after 7/1/2020,
- Expanded definitions under FLI, including adding sibling, grandparent, grandchild, any other individual related by blood to the employee, and any other individual that the employee shows to have a close association with the employee which is equivalent of a family relationship to the definition of covered family member,
- Raising the maximum amount a person could receive for FLI from approximately $638 to $860 per week,
- Elimination of the 7-day waiting period for FLI benefits,
- FLI will be paid for intermittent baby bonding without employer approval - 15 days advance notice is required by individual, and
- An employer can not retaliate against an employee by refusing to restore the employee following a period of leave.
According to EANJ’s survey, most paid leave claims have been filed by women, usually to care for newborn babies and employees of larger employers file more claims than those from smaller firms. In fact, the survey shows that for employers with 49 or fewer employees, only 2 of 10 had an FLI claim within the last 12-months. This may be due to the fact that FLI does not provide job protection. The non-retaliation provision may change that, as the FLI now reads: “An employer shall not . . . retaliate on the basis that the employee requested or took FLI including retaliation by refusing to restore the employee following a period of leave . . .” This provision creates de facto job protection.
In terms of administrative burden, the EANJ survey shows that regardless of employer size, it took on average about an hour to process an FLI claim.
Also, in April, 2019 Rutgers Center for State Health Policy and the Robert Wood Johnson Foundation issued Building a Culture of Health in New Jersey: A Policy Roadmap to Help Everyone Live Their Healthiest Lives informed by input from experts and stakeholders from across the state, the report details priority areas for action, including ensuring maximum uptake of the recently expanded paid family leave benefit, particularly among low-income workers. According to the report: “Evidence suggests that paid family leave policies benefit caregiver and infant health without causing employers undue financial or administrative burdens.”
Additionally, the report recommends “that special attention should be given to raising awareness among populations with historically low benefit uptake rates (e.g., men, low-wage workers, and non-English speakers) and a training program for employers should be developed with specific resources for small businesses, those with low wage workers, and those with many non-English speaking workers.”
Similarly, a survey conducted by Rhode Island University in 2016 shows that lower-income workers file paid leave claims at a lower rate than higher-income workers. The report notes that the lower participation of low-income workers may be due, in part, to wage replacement benefits not high enough to support time off. Another explanation for lower rates of participation among employees of smaller firms is a lack of program awareness. In the survey, for employees who experienced life events that qualified them for paid leave benefits, only 51.4 percent knew the program existed.
FLI’s expansion also included $1.2 million to expand awareness and outreach efforts to promote the program’s availability of paid family leave, and charges the Department of Labor and Workforce Development to actively engage with employers. The Department has launched MyLeaveBenefits a website to help workers and employers to better understand and navigate the FLI program.