San Francisco

San Francisco Becomes First City in Nation to Require Businesses to Provide Fully Paid Parental Leave

Advocates say many families can't afford to take leave, but critics contend the measure hurts small businesses

San Francisco has approved a measure making it the first place in the nation to require businesses to provide fully paid leave for new parents.

The San Francisco Board of Supervisors voted unanimously Tuesday after supporters said six weeks of fully paid leave is needed because too many families can't afford to take time off after a child is born or adopted.

When the law takes effect in 2017, San Francisco businesses will have to share the parental leave cost with the state.

The state already allows workers to receive 55 percent of their pay for up to six weeks to bond with a new child. The money comes out of a state insurance program funded by workers.

The proposal requires city employers with at least 20 employees to make up the rest. If an employer provides benefits that equal or exceed this requirement, the ordinance would not apply.

"We’re trying to balance the needs of businesses and of many families who are struggling to get by," Supervisor Scott Wiener told NBC Bay Area Tuesday morning. "Especially low-income and working class families right now literally having to choose, 'Do I spend time bonding with my child or put food on the table?' And that is a choice no one should have to make."  

Nume Montoya, a single mother who didn't have the opportunity to take six weeks off from work after the birth of her son, agreed. 

"I think it's about time, especially for single mothers who work really hard to take care of their kids," she said. 

Advocates say the legislation is needed because too many families can't afford to take leave, but small business owners say the latest proposal is just another in a long list of city mandates — including paid sick leave and health coverage — that unfairly target independent owners.

Federal law grants workers up to 12 weeks of unpaid leave. California, Rhode Island and New Jersey are the only three states in the nation that already provide partial pay, with the money coming from employees. Legislators in New York last month approved up to 12 weeks of partial pay.

The United States is one of only four countries in the world that does not guarantee paid maternity leave, the others being Swaziland, Lesotho, and Papua New Guinea. Nationally, only 12 percent of workers have access to paid family leave through their employers, and only half of first-time mothers take any paid leave, according Wiener, who is spearheading the legislation.

Some workers have it better. New parents who work for the city and county of San Francisco enjoy 12 weeks of leave at full pay, while private employers such as Facebook and Microsoft are generous with leave as a way to retain workers. NBC Bay Area was the first to report in May 2013 that Yahoo began paying new mothers for 16 weeks of maternity leave, and fathers for eight weeks.

But Wiener says not everyone works for the city or Facebook. He sees paid leave for full-time and part-time workers as another step toward addressing income inequality, much like the $15 hourly minimum wage legislation that California Gov. Jerry Brown signed Monday and San Francisco approved for workers in 2014.

"Fully paid family leave will make it more likely that women will return to work, return to a previous employer and return with the same or higher wages," said Jennifer Reisch of Equal Rights Advocates.

For small businesses, however, the proposal is yet another requirement that cuts into their competitive edge, according to Mark Dwight, founder of Rickshaw Bagworks, a company of 30 employees that makes custom work bags in San Francisco. Local businesses don't have the wiggle room to spread costs or turn to deep-pocketed investors, he said.

"We are in the most expensive place to do business, and that's all we've got. The economies of scale are just not there,'' Dwight said, adding of the mandates, "It's kind of like, where does it end?''

San Francisco's Small Business Commission, of which Dwight is president, opposed the measure, saying that the increased costs, along with high rents and taxes may deter new business from opening in the city.

The San Francisco Chamber of Commerce was neutral. Both groups, which represent thousands of small businesses, say these matters are better addressed by the state or federal government.

The business-sponsored Bay Area Council, whose members include Google and Microsoft, supported the proposal. Other advocates include: Planned Parenthood, the California Work & Family Coalition, Equal Rights Advocates, the Legal Aid Society – Employment Law Center, and The Opportunity Institute.

A California bill increasing the amount of paid leave to 70 percent of wages awaits the governor's signature.

Advocates say the issue is gaining momentum across the country, much like the debate over a higher minimum wage.

"This is another opportunity for San Francisco to stand out and show other jurisdictions that it can be done, and it's feasible,'' said Julia Parish, staff attorney at Legal Aid Society-Employment Law Center in San Francisco.

Small businesses with fewer than 50 employees have until 2018 before the requirement takes effect.

NBC Bay Area's Lisa Fernandez and Chuck Coppola contributed to this report.

Copyright AP - Associated Press
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