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Thursday, June 24, 2010

Leave Benefits in the United States

Linda Levine
Specialist in Labor Economics

In addition to their jobs, workers have obligations—civic, familial, and personal—to fulfill that sometimes require them to be absent from the workplace (e.g., to serve on a jury, retrieve a sick child from day care, or attend a funeral). The U.S. government generally has allowed individual employers to decide whether to accommodate the nonwork activities of employees by granting them leave, with or without pay, rather than firing them. In other countries, national governments or the international organizations to which they belong more often have developed social policies that entitle individuals to time off from the workplace (oftentimes paid) for a variety of reasons (e.g., maternity and vacations).

Public policies specifically intended to reconcile the work and family lives of individuals—which include leave benefits, child-care subsidies, and flexible work arrangements—have garnered increased attention among countries in the Organization for Economic Cooperation and Development (OECD). In the United States, which is an OECD member, congressional interest has coalesced around family-friendly paid leave proposals (e.g., H.R. 2460/S. 1152 and H.R. 1723). Typically, they would entitle workers to time off with pay to accomplish parental and caregiving obligations to help women in particular balance work and family responsibilities because they are the typical unpaid family caregiver and most women work for pay, with both spouses employed in about one-half of married-couple families.

Currently, there are few federal statutes that pertain directly or indirectly to employer provision of leave benefits for any purpose. This report begins by reviewing those policies, including the Pregnancy Discrimination Act and the Family and Medical Leave Act. Temporary Disability Insurance (TDI) programs, which five states have established to compensate for lost wages while workers are recovering from nonoccupational illnesses and injuries, are discussed as well. So too are the California and New Jersey family leave insurance programs, which essentially extend the TDI programs of the two states to employees caring for family members. The Obama Administration has requested $50 million as part of the Labor Department's FY2011 budget for grants to states to help them plan and set up paid family leave programs.

The report then examines the incidence of different types of paid leave that U.S. employers voluntarily provide as part of an employee's total compensation. For example, vacations and holidays are the most commonly offered leave benefits: more than three-fourths of employees in the private sector receive paid time off for these reasons. Access to leave by various employee and employer characteristics also is analyzed. Particular attention is focused on paid sick leave, which was offered to 61% of private sector employees in June 2009, according to the latest data from the U.S. Bureau of Labor Statistics.

The report closes with results from a federal government survey of the average direct cost to businesses of different types of leave. Indirect employer costs that might arise in connection with some types of leave more than others (e.g., the greater likelihood of hiring and training temporary replacements for employees absent because of maternity versus bereavement reasons) are not included. Neither are estimates of potential gains to employers (e.g., a more stable, experienced workforce) and society (e.g., improved public health and broader participation in civic affairs).

Date of Report: June 17, 2010
Number of Pages: 25
Order Number: RL34088
Price: $29.95

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