December 19, 2016
To Members of the DC Council,
We are writing as small businesses operating in the District of Columbia to express our strong support for the Universal Paid Leave Act as adopted by the DC Council on first reading on December 6, 2016. We strongly oppose proposals to replace the UPLA with an “employer mandate” that would require businesses to provide paid leave directly, without the benefit of a social insurance fund. The employer mandate meets the needs of big business in DC, at the expense of small locally owned businesses.
The UPLA will allow small businesses to provide an important benefit to their workers, that many currently cannot afford to do, that will improve morale and productivity, and reduce turnover. Paid family and medical leave will be good for our workers – and for our businesses. The UPLA uses a “social insurance model” that would provide a paid family and medical leave benefit to small businesses at a low and predictable cost. (Just $186 a year for an employee making $30,000.) Because paid leave benefits would be paid out of a fund managed by the city, small businesses would be able to pay for replacements when an employee takes leave, without adding to normal operating expenses.
By contrast, the employer mandate would be a nightmare for small businesses, keeping small business owners up at night worried about who will need leave next. An employer mandate would be financially risky, because no small business would be able to predict when one or more workers would need to take leave, for which small the business owners would be fully liable.
Big businesses can afford to pay out of pocket. Small businesses cannot: A big employer has enough employees to safely predict their annual paid leave costs - when you employ hundreds of people you can rely on averages, and you have millions of dollars in the bank to provide a cushion. Small businesses could be scuttled by just one employee needing to take leave, if they have to produce thousands of dollars on demand. For example, one paternity leave for a middle income employee could cost a small business up to $8,000 out of pocket, perhaps more if they need to hire a replacement staffer. Offering paid leave on our own is not financially feasible. Being required to provide it – with only minimal tax credits to offset the costs – is not right.
Businesses don’t need to be told to provide paid leave - they need a real way to be able to offer this life-saving benefit at a manageable, predictable cost. Without government leadership, paid leave will remain out of reach of thousands of DC small businesses and families.
Nizam Ali, Ben’s Restaurants
Pennye Jones-Napier, Big Bad Woof
Gina Schaefer, A Few Good Hardware Stores
Andy Shallal, Busboys and Poets