MANKATO — Mankato resident Cora Uyigue has worked part time and seasonally for the majority of her career, so she knows what it’s like not to be eligible for paid family and medical leave programs.
It’s one of the reasons she supports the Minnesota Paid Leave program.
“Because I know there are so many people that need that, and that paid family and medical leave is not something that is promised or guaranteed,” she said.
Starting Jan. 1 of next year, Paid Leave will provide paid time off when a serious health condition prevents someone from working, when someone needs time to care for a family member or a new child, for certain military-related events or for certain personal safety issues.
Now a program coordinator at a local nonprofit, Uyigue said she benefited from a similar new law — Earned Sick and Safe Time, effective 2024 — when a family event happened last year.
Under ESST, employees in Minnesota earn one hour of sick and safe time for every 30 hours worked and can earn a maximum of 48 hours each year unless their employer agrees to a higher amount.
“My organization has benefited from the ESST … and that was not something that we would’ve had access to prior to that bill going forward,” Uyigue said.
“I ended up having a family event happen last year that did require me to take time off and spend a lot of time up in the Cities. Without that time, it would’ve definitely impacted my paycheck.”
Kathy Sallstrom, who is retired, also supports Paid Leave because of a medical issue that wasn’t her own.
“Several years ago a family friend had a child who required intensive supervision at home following a diagnosis,” she said.
“What happened is, initially, others provided the supervision while she, a single parent, attempted to go back to work … But being away from her child created intense stress and worry at work because, not surprisingly, she just had to be home with her child.”
At the time her friend was able to leave her job with a guarantee that she could return, Sallstrom said, but there was no aspect of pay.
“So in her case she needed to be on leave for 12 weeks, and I’m glad to say her child recovered. This led to a happy ending. But the ramifications of an unpaid leave over three months for most people would be unpaid rent, which leads to an eviction, unpaid mortgage, which could lead to a foreclosure, unpaid utilities, food insecurity, maybe even a repossessed car,” she said.
The business perspective
But this session, local lawmakers on both sides of the aisle are considering changes to Paid Leave before it even goes into effect due to concerns from business owners such as Josh Vanderberg, owner of Vanderberg Clean in Mankato.
“It’s one of those things that we really want more information on,” Vanderberg said. “When you look at it, regardless of how it’s done, it’s going to be a tax on business and it’s going to be more expensive to do business in the state of Minnesota.”
The sentiment is common especially among small business owners. Vanderberg, who has 10 full-time employees and about 60 part-time workers, said he still has a lot of questions.
“It makes us very nervous because we never know how these are going to affect us and how much regulation is going to be there for us to have to deal with,” he said.
“How much time is it going to take to administer this … How much initial expense is it going to be to have it, and then how is it going to affect the company if somebody is needing to take long-term leave?”
Vanderberg said his team works hard within the rules to give people time off when they need it.
“As a business owner, our people are really very important to us, and anytime we can provide something that’s beneficial to them, we definitely want to take a look. We want to work as hard as we can to make a quality place of employment,” he said.
Greater Mankato Growth Executive Vice President Andy Wilke said he’s also heard concerns from the business community about Paid Leave.
Wilke said among GMG’s membership, about three-quarters are small businesses.
“This is a massive new program, and it really is interjecting the state in between the relationship between the employee and the employer,” he said.
The program now and proposals
According to the state, Paid Leave will be funded by premiums, which Minnesota will collect from employers. As of now, when the program begins, the premium rate will be set at 0.88%.
Employers can split the cost of Paid Leave with employees, but they must pay at least 50%. They could then deduct the remainder from employee pay.
In a bill with bipartisan support, DFL Sen. Nick Frentz, of North Mankato, proposes changes to Paid Leave that address various questions, including who someone can take time off to support and defining a small employer — lawmakers and stakeholders alike have also raised the idea of whether certain-sized companies should be exempt from the program.
Frentz defines a small employer as someone with 15 or fewer employees.
He also classifies family as a spouse or domestic partner, a child — including a biological child, adopted child, foster child, stepchild, child of a domestic partner or child someone is a legal guardian of — a parent or legal guardian, grandchild, grandparent or up to one person annually designated by an employee.
“We are responding to concerns that Mankato area small businesses have raised about the cost and reliability of (Paid Leave),” Frentz said. “We want to fight just as hard for the balance between employees and employers to get the best jobs the best results.”
Frentz’s bill isn’t the only proposed legislation on the table that proposes changes to the program.
Republican Rep. Bjorn Olson, of Fairmont, says Republican Rep. Dave Baker, of Willmar, has a bill that defines a small employer as someone with 50 or fewer employees and has an exemption for collective bargaining agreements.
“While we do think that Rep. Dave Baker’s proposal is a little bit better, Sen. Frentz’s is a good way of ensuring that we’re doing a better job with this (program),” Olson said. “At this point, we’re willing to negotiate on just about anything to save our small businesses, and I think this kind of strikes a good tone too if we can’t get rid of it entirely. This is one of those better-than-nothing situations.”
While Frentz’s bill has support from both parties, DFL Rep. Luke Frederick, of Mankato, is against it. “I think that where I’m at is that I still support every worker being able to have access to the program,” he said.
“Every worker, regardless of their employer size, should be receiving this benefit because it doesn’t matter whether you are one of five employees or one of 5,000 employees.”
Frederick said he understands cost questions to businesses but has another concern.
“I understand that there’s a financial argument that’s being made of why we carve out small employers. I think the harm that could come from this is that we’ll drive more workers away from those places of business,” he said.
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