Prop. 118 would create family, medical leave insurance plan

A citizen-based initiative on the November general election ballot in Colorado would create an insurance plan that would pay workers when they are unable to be at their regular jobs because of personal or family reasons.

The initiative builds on the federal Family and Medical Leave Act, which provides unpaid time off during family and health emergencies.

If passed, the plan’s critics say, it would create a new tax on workers and businesses and set up a new unit of government that would not be subject to the same checks and balances as other governmental agencies.

Proposition 118, as it is identified on the ballot, rose out of failed attempts over multiple years to create a paid-family-leave law through the legislative process. 

Its basic elements:

• Businesses or nonprofits with 10 or more employees would be required to pay premiums into the program.
• Businesses would be required to pay at least half, and could pay more, of the premium for each employee. Employees would pay the other half.
• Businesses with nine or fewer employees would not pay into the program, but their employees would be required to pay half of the premium that would otherwise apply.
• Self-employed workers would not pay into the program, and local governments are exempt but could choose to participate. State government would be required to participate.
• The premium is equal to 0.9% of a salary up to a designated amount, with the premium able to be increased after year two of the program at the discretion of the plan’s administrator.
• Payments to workers who use the program can be up to $1,100 per week for 12 weeks, depending upon wage level and the state’s average weekly wage.

“This program doesn’t add new reasons for paid leave; it just gives employers a way to help pay for that leave,” said Karen Moldovan, director of policy for Good Business Colorado, the group behind the initiative.

It does that, according to Kristi Pollard, senior vice president of Catalyst Public Affairs, by implementing a new, $1.3 billion tax.

“All employees pay regardless of whether they use this or not,” Pollard said. “It’s a payroll tax; there’s no choice like there is with insurance,” she said.

Moldovan countered that employers are able to retain employees who otherwise might leave and have a state program pay their salaries during the time the employees are off the job. Unpaid workers might have to access social-service programs to sustain themselves without a program like this, she said.

The program is progressive, Moldovan said, because lower-wage employees receive a larger percentage of their wages paid through the program than higher-paid workers.

Pollard said the initiative creates a new unit of government within the state Department of Labor and Employment that can grow to up to 197 new employees with its revenue source not subject to the Taxpayers Bill of Rights. The director of the department can unilaterally increase the premium to 1.2% of wages paid without oversight, Pollard said.

Moldovan said the program provides a “comprehensive definition” of what constitutes a family for purposes of the leave provisions. 

The initiative language includes the traditional family units from grandparents to grandchildren but also includes “any individual with whom the employee has a significant personal bond.” 

Supporters of the proposition include numerous elected officials, AARP-Colorado, American Association of University of Women – Colorado, unions such as the AFL-CIO, the Bell Policy Center and others.

Many chambers of commerce in the state, including those affiliated with the Northern Colorado Legislative Alliance have issued statements in opposition. The Boulder Chamber has taken a neutral stance.

Other opponents include the Associated General Contractors of Colorado, National Federation of Independent Business, and Colorado Rising State Action.

“A program like this is too rich anytime but now [during the recession] is definitely not the right time,” Pollard said.

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