- Its work history requirement excludes around one-third of new mothers.
- Its lack of a minimum benefit makes it hard for low-earners to live off of it.
- It provides twice as much leave to two-parent families as one-parent families.
- It allows employers to displace the federal benefit with their own employer-provided benefit and provides bizarrely-designed cash grants to subsidize them if they do so.
In making the last point, I have mostly focused on the way it complicates the paid leave system and the way it wastes money by allowing employers with below-average paid leave costs to profit off a kind of paid leave arbitrage.
But there is another problem with running the program through employers and private insurers that is harder to quantify and argue about so clearly. The problem is that employers and insurers are awful benefit administrators that don’t seem to give a shit about workers, especially not lower-level workers.
In the case of paid leave, this is a really big problem because, under the House Democrats’ paid leave scheme, both employers and insurers have every incentive to try to get workers to not take paid leave or to cut their paid leave short.
If you think employers and insurers will, on average, be better and fairer at administering paid leave than the Social Security Administration, then you are kidding yourself. If you think that the appeal rights that workers are provided if their employer doesn’t give them the benefit they are entitled to will actually protect them from being jerked around, then you are really kidding yourself.
For an example of how badly this can go, take a look at yesterday’s New York Times article about Amazon’s paid leave mishaps.
[Amazon] workers across the country facing medical problems and other life crises have been fired when the attendance software mistakenly marked them as no-shows, according to former and current human resources staff members, some of whom would speak only anonymously for fear of retribution. Doctors’ notes vanished into black holes in Amazon’s databases. Employees struggled to even reach their case managers, wading through automated phone trees that routed their calls to overwhelmed back-office staff in Costa Rica, India and Las Vegas. And the whole leave system was run on a patchwork of programs that often didn’t speak to one another.
Some workers who were ready to return found that the system was too backed up to process them, resulting in weeks or months of lost income. Higher-paid corporate employees, who had to navigate the same systems, found that arranging a routine leave could turn into a morass.
In internal correspondence, company administrators warned of “inadequate service levels,” “deficient processes” and systems that are “prone to delay and error.”
No sane person would think that this is who you should entrust to run your party’s signature paid leave program. And yet that’s exactly what the Democrats are proposing to do.
To make things worse, in the last few days, we have learned that the paid leave proposal has been cut back from a permanently-enacted 12-week program to a temporarily-enacted 4-week program.
It is hard to know when a proposal is so paltry and so badly-designed that it is simply not worth doing at all. But the paid leave proposal is strongly tilting in that direction. A small, temporary benefit with tons of coverage holes is not especially alluring and the private insurance design could start us down a path where, for the rest of history, we are having to deal with a costly, dysfunctional paid leave system that we can’t really fix because it would be seen as too disruptive to existing private insurance plans.
There is a way to design a paid leave benefit, even a modest one, that would make it one of the best things in the package. But the Democrats have not done this. In a scenario where conservative Democrats are forcing cuts to the package, the paid leave proposal seems like it should be the first to go.