An Idea for Paid Family Leave That Just Might Work

The collapse of Build Back Better has opened up more space for Republicans to innovate on paid leave, and a new idea is taking shape that could garner bipartisan support.

Here’s the nut of it: Provide parents a flat, lump sum benefit upon the birth or adoption of a child. Pair this benefit with a limited expansion of the Family and Medical Leave Act, specific to birth and for a more limited amount of time but for which nearly every worker would be eligible (relative to the 40 percent of workers excluded from FMLA protections today). 

This proposal builds on the bipartisan energy around a child tax credit (CTC) expansion for young children, renewed Democratic energy around modernizing FMLA, and Republican energy around keeping business interruption and fiscal burden to a minimum while solidifying pro-life, pro-family bona fides. 

Importantly, it would guarantee a baseline level of support and protection for all American infants, without their parents experiencing unnecessary financial or employment-related stress. In doing so, it could be the most inclusive paid parental leave idea on the table thus far.

The germ of this idea began with a bipartisan, bicameral paid leave proposal introduced in December 2019 by Sens. Bill Cassidy and Kyrsten Sinema and Reps. Elise Stefanik and Colin Allred. In the proposal, parents were allowed to advance $5,000 of CTC payments upon the birth or adoption of a child; in return parents would receive $500 less each year in CTC payments for the next 10 years. 

This proposal had the advantage of being mostly budget neutral over time, essential for many Republicans, as well as increasing the flexibility of an existing government benefit instead of creating a new “entitlement.” But it was panned by some for not being paid leave since the receipt of the benefits had no connection to work or staying home to bond with children, and it did not address the lack of job protection experienced by a significant share of workers that would prevent them from using the benefit to finance leave-taking to begin with

It also had the unfortunate timing of being dropped right before the pandemic, when the paid leave debate swiftly transformed to actionable COVID-related paid family and medical leave support, to be followed by the Build Back Better proposal, which instead of building on bipartisan momentum around paid leave, put forward more or less the same Democrat-led proposal that’s been around for a decade and has been a nonstarter with conservatives.

With pandemic-related paid leave provisions expired and BBB fading, Republicans have begun revisiting CTC or lump sum cash payments as a vehicle for paid leave with some new additions. For example, in January, Sen. Mitt Romney and colleagues introduced the Tax Credit for Pregnant Moms Act, legislation that will allow pregnant women to claim the child tax credit for their unborn children. This money could be used to financially cover a period of unpaid leave upon birth, while maintaining the full CTC benefits in that baby’s first year for childcare or another purpose, and doesn’t appear to come from reducing other child-related benefits. 

Along these lines, conservative scholar Patrick Brown of the Ethics and Public Policy Center recently released a report calling for a universal, lump sum cash benefit for new parents to cover up to six weeks of leavetaking, citing the overwhelming support even among Republicans for paid leave for new mothers in particular. Brown writes that such a benefit would need to be paired with job protection to be effective. I agree. 

Which brings us to FMLA reform that could help to strengthen conservatives’ cash-only proposals.

 Currently, FMLA excludes nearly 40 percent of workers due to restrictions on employer size and job tenure. Resources to provide pay for periods of leave—whether from advance CTC payments or a pregnancy CTC or a lump sum cash benefit—are helpful, but obviously would be most helpful if accompanied by job protection and a broader social norm wherein American parents take leave following the birth of a child. 

For years, Democrats have introduced FMLA modernization legislation in a push for its protections to cover nearly all workers, such as the recent Job Protection Act by Reps. Tina Smith and Lauren Underwood. But this overlooks why such exemptions were included to begin with—which was to protect businesses from having to hold a job for months for someone who just started working there and to limit the burden on small businesses that come with all employees entitled to up to three months of leave for a wide variety of reasons—and so is likely to face pushback. 

 This is an opportunity for Republicans to jump into the ring to better protect parents and infants while curbing the business burden proposed by Democrats. Specifically, conservatives could pair a cash benefit to new parents with an extension of FMLA for a shorter duration and more limited uses, such as six weeks following the birth or adoption of a child, which could be applicable to businesses of any size and for workers who’ve been with that employer for at least three months.

While it is understandable that small businesses might be concerned about complying with a broad 12-week job protection mandate that could be used for a wide variety of purposes—intermittently and annually—it would be much harder for them to argue that nearly half of new parents aren’t entitled to any job protection at all. Birth is by its very nature a limited occurrence, leave tends to be taken all at once, instead of broken out, and there is little fraud associated with it. Are businesses going to advocate to maintain their right to fire a new mother if she doesn’t return to work the week following birth? Moreover, the government funding this child-related benefit would reduce pressure on small businesses having to do so themselves.

And while I’ve long been an advocate of a standalone paid parental leave program, a universal cash benefit combined with near universal job protection around birth could be the most inclusive paid leave proposal for new parents thus far. For example, the BBB paid leave proposal would have left out 30 percent of new parents who had insufficient work histories, according to the Congressional Budget Office, and many Democrat paid leave proposals have not included job protection either.

Of course, cash benefits for new parents paired with job protection wouldn’t solve everything. For example, I think there are still significant cultural challenges around normalizing that mothers and fathers be paid to stay home for weeks or months following birth to heal, bond, and adjust as a new family. I think that a standalone paid leave program would help to normalize leave taking more since the benefit would only be claimed if people changed their behavior. But it would certainly be an improvement upon the status quo, and one that could bring both sides together.

There’s a potential for a bipartisan compromise on paid leave and a baseline level of support for all American infants, but it’s going to take more imagination than a cash handout.

Abby M. McCloskey is an economist and founder of McCloskey Policy LLC. She has advised multiple presidential campaigns.