The D.C. Council on Tuesday gave final approval to legislation that would create the nation’s most generous paid family leave program, sending the bill to Mayor Muriel Bowser to sign into law.
With a veto-proof majority, city lawmakers voted 9-4 to pass the Universal Paid Leave Amendment Act of 2016. It would provide eight weeks of leave for caring for a newborn or newly adopted child, six weeks for tending to a sick relative and two weeks for taking care of personal medical needs.
It is estimated to cost $250 million a year and will be funded via a 0.62 percent payroll tax on about 8,000 city businesses.
“I will not add my name to this legislation,” Miss Bowser said, indicating she likely will allow the bill to become law without her signature.
The Democratic mayor had given tepid support to an alternative bill that would have directed employers to fund their own paid leave plans, but stopped short of threatening to veto the payroll tax plan.
“Every business, regardless of size or ability, will be able to offer paid leave,” said council Chairman Phil Mendelson, at-large Democrat. “The only way to do that is through a tax.”
But the vote belies the council’s struggle over funding the program during the past few days. On one side was a business-friendly employer mandate that would leave it to businesses to fund and implement on their own programs. On the other side was a labor-friendly version that would be funded through a payroll tax and administered by the city.
For hours Tuesday morning, council factions, mayoral representatives, business owners and paid-leave advocates lobbied in the halls of the fifth floor of the Wilson Building. On the dais in the afternoon, the debate got heated as advocates from both sides erupted into applause in the council chamber.
Ultimately, swing votes cast by Democratic council members Anita Bonds, at-large Democrat, and Kenyan Duffie, Ward 5 Democrat, defeated the employer mandate alternative, paving the way for passage of the payroll tax plan.
“I have restaurants [in Ward 5] on both sides of this issue. This is not a perfect system. It’s unprecedented,” Mr. McDuffie said. “What’s lost in this debate is that you have a legislature who is working extremely hard to establish a system of paid leave.”
Ms. Bonds said it was an incredibly difficult decision to choose between the payroll tax plan and the employer mandate model.
LaRuby May, Ward 8 Democrat; Brandon T. Todd, Ward 4 Democrat; Yvette Alexander, Ward 7 Democrat; and Jack Evans, Ward 2 Democrat voted against the final version of the bill.
The city will have to create an agency to administer the program — an estimated cost of $80 million. Under the paid-leave program, workers earning less than 1.5 times the minimum wage would receive 90 percent of their wages per week, and those earning more than that would get 50 percent of their wages up to $1,000 per week.
Workers in the District will have to wait until about 2020 to use the program. The city will need at least a year to create the agency to administer claims and another year to collect enough in payroll tax revenue to fill the fund.
Some council members worried that too much money would go to workers who are employed in the District but live in Maryland and Virginia.
Of the District’s 531,999 workers, about 195,000 also live in the city. Employment statistics show that 201,981 live in Maryland and 134,192 in Virginia, meaning nearly two-thirds of the city’s workforce would receive and likely spend paid-leave benefits outside the District.
“It is wrong to raise District taxes to fund a costly new government program that sends 66 percent of the benefits outside of the city and leaves District families behind,” Miss Bowser said. “I predict the council will need to revisit this legislation and address the detrimental impacts on District residents and small businesses.”