Davis OKs Paid Family Leave Bill

Marisol Quintero, a bill collector, said paid family leave would have made life much easier when her baby son was born with a rare disease and needed her at home.

But Bill Nelson, who employs 65 people at four Northern California lube shops, said he worries that such a benefit will cost him business when, for example, an experienced store manager takes six weeks off to care for a newborn or a sick relative.

As Gov. Gray Davis signed a bill Monday creating the nation’s first comprehensive paid family leave, business leaders counted flaws. The new law will give up to six weeks of partially paid leave to an estimated 13 million California workers. Payments will come from employee contributions and take effect in 2004.

Where employees and labor leaders see a morale-boosting benefit, small- and medium-size business owners fear losses from unplanned absenteeism and the skyrocketing cost of temporary replacements.

And many in California’s small-business community say some employees already abuse the federal law granting unpaid leave for births and family sick care. They argue that even more employees will be tempted to lie or skirt the rules under California’s paid leave initiative.

“We don’t have problem with employees having time off for legitimate illnesses or family reasons, but there are abusers of this family leave program,” said Paul Calvert, western regional vice president for Inland Paperboard and Packaging, a division of a Texas-based company that employs 2,000 people in California.

Calvert said employees in one plant already had a name for the unpaid family leave act adopted under President Clinton. “They call it the ‘Gold Card,’ ” he said.

The 150 employees had taken 311 family leave absences in the last 14 months, Calvert said. About 90% of those absences were without notice and lasted one day, he said. About 25 of the plant’s 150 employees accounted for the most of the absences, he said.

The California Manufacturers and Technology Assn., which opposed the bill, had argued that without a length of service requirement, “even a temporary worker would be able to take six weeks off.” Small businesses, those with five to 10 employees, will have the most trouble covering for missing workers, association officials said.

“It’s so easy for someone to say, ‘Aunt Mary needs me to go take care of her,’ and the decision whether that person is eligible for paid leave or not is going to be made” by the Employment Development Department, said Nelson, owner of the Pennzoil 10-Minute Oil Change shops.

“That’s just going to encourage abuse. Most people won’t abuse it,” he said. “But it doesn’t take a large population to abuse something to really run up the cost and cause havoc for employers.”

Tom Lucas, who employs 70 people at four outlets of his Southern California Performance Nursery, aimed his frustration at Davis.

“Small businesses can’t take another hit like this,” said Lucas. “We can’t afford to have Gray for another four years. The unions are pushing this down his throat. I wish he’d wake up.”

Davis and advocates of the bill said Monday that the new law will fairly balance the needs of workers and employers.

The policy will pay workers 55% of weekly salaries for time off to care for sick children, spouses, parents or domestic partners, as well as for parents of newborn or newly adopted children. The amount will be capped at $728 a week and is tax-free. Workers will pay up to $70 a year into the benefit fund.

Davis agreed to the bill after the program was scaled back from earlier proposals allowing 12 weeks of paid leave and requiring employer contributions.

“I don’t want parents in California to have to choose between being a good parent and a good employee,” said Davis during the bill-signing on the lawn outside UCLA’s Children’s Hospital.

Statistics showing that three of four Californians cannot afford to lose a paycheck to care for sick family members help persuade Davis to sign the bill, he said.

Labor leaders and women’s advocates, who called the program long overdue, waited in blistering heat for Davis to appear. It’s hot, someone said, prompting the bill’s sponsor, state Sen. Sheila Kuehl (D-Santa Monica), to jump to the microphone.

“But not as much heat as we took getting this bill through,” she said to applause.

Kuehl and other boosters of the legislation ticked off a long list of worker benefits that business predicted would ruin the American economy, including minimum wage laws, workers’ compensation and unions.

Workers rights advocates argue that the new law will make California more attractive to skilled workers.

They say productivity will go up if workers have a safety net for family emergencies.

The GOP gubernatorial candidate, Bill Simon Jr., agreed with business leaders in opposing the leave bill signed by Davis.

“I support the concept of paid leave for people, particularly workers who can’t afford to take unpaid leave,” the candidate said during a campaign stop in Long Beach.

But he added: “I don’t think this is the best way to accomplish some type of paid leave, because, in effect, what this really is, is a kind of tax on 14 million Californians in the workforce.”

Simon said he would support an optional program, allowing workers who wanted the benefit to pay into the system.

Davis said he signed the bill for such workers as Quintero, who introduced Davis to the crowd. When her son was 2 months old and her maternity leave was nearly used up, she said she got terrible news.

John Paul was diagnosed with a rare blood disorder that would require many blood transfusions and constant care.

Going back to work was out of the question, even though she and her husband needed the income.

In the ensuing weeks, as bills mounted, the Quinteros barely made ends meet.

“We tried financial aid, but there was really no hope,” she said.

Quintero, who sat on a makeshift stage, her daughter in her lap and son nearby in his father’s arms, broke into a smile as the governor signed the bill.

“Something like this,” she said later,” would have really made a difference for us.”

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Times staff writers Matea Gold, James Flanigan and Carl Ingram contributed to this report.