THE BLOG
01/21/2011 12:29 pm ET Updated May 25, 2011

Another "Job Killer" Lie Exposed

You may think it's a way to help your spouse or aging parent recover from a devastating illness, but to the National Federation of Independent Business (NFIB) California's Paid Family Leave (PFL) law, enacted in 2002, is a "job killer" that costs employers billions of dollars and drives jobs out the state. Allen Zaremberg, president of the California Chamber of Commerce, echoed that view, calling the law "one of the worst."

But a new comprehensive study reveals that these corporate lobby group have been crying wolf. The report, based on a survey of employers and employees, found that the California law has not turned out to be the costly "job killer" that big business warned about. To the contrary, the Paid Family Leave law has produced significant economic, social and health benefits for both male and female workers.

California Governor Gray Davis signed the law on Sept 23, 2002 in the face of massive business opposition. Funded by employee contributions to a state disability fund, the law provides up to six weeks of paid leave to employees to care for a new child or ailing relative.

While the legislature was reviewing the proposed family leave law, the California Chamber of Commerce put it at the top of its annual hit list of "job killer" bills. For the Chamber, this is an annual ritual with lots of fanfare, warnings to legislators (many of whom line their campaign war chests with business contributions), and media stories in which business folks stay on message by repeating the words 'job killer' as many times as possible so that the idea sticks.

In 2002, the Chamber organized a who's who of business lobbies to oppose the bill. The National Federation of Independent Businesses, the California Manufacturers and Technology Association, the California Small Business Association, the California Grocers Association, the California Restaurant Association and their corporate cohorts created a "job killer" message machine warning that, if enacted, the family leave law would trigger economic devastation.

The business groups' key talking point was a so-called "estimate" that the bill would cost the California's private employers $3 billion dollars in the first year alone.

After Gov. Davis signed the bill over their opposition, the California Chamber issued a statement predicting that "Many businesses will look to other states when relocating or starting up to avoid these types of mandates." NFIB spokesperson Tony Malandra, warned "The hidden costs of this are going to be enormous."

The next year, Jack Stewart, president of the California Manufacturers and Technology Association, Allan Zaremberg, president of the California Chamber of Commerce, and Bill Hauck president of the California Business Roundtable, penned a column in the San Diego Union-Tribune branding the family leave law a "mega job killer."

During the legislative battle, the law's key proponent, then-State Senator Sheila Kuehl, said that the business opponents were "crying wolf" about the bill's impacts on jobs.

It turns out she was right.

For their newly-released study, authors Ruth Milkman, a professor at City University of New York and UCLA, and Eileen Applebaum, an economist at the Center on Economic Policy Research, conducted extensive surveys of California employers and employees covered by the family leave law. Their findings discredit the corporate cry babies. For example:

  • The business community's claims that the law would impose crippling new costs on employers and particularly small businesses were unfounded. The vast majority of employers reported it has had minimal impact on their business operations
  • Most employers reported that PFL had either a "positive effect" or "no noticeable effect" on productivity, profitability/performance and employee morale.
  • A majority of employers reported the law actually translated to cost savings realized by coordinating their own leave benefits with the state PFL program.
  • An overwhelming majority of workers that used the benefit reported a positive effect on their ability to care for a new child.
  • PFL doubled the median duration of breastfeeding for all new mothers that used the benefits.

The U.S. Chamber of Commerce and its Republican allies in Congress are now using the accusation "job killer" the way Sen. Joseph McCarthy used the word "Communist" to stigmatize any organization and policy they disagree with. Their goal is to stop any legislation that would require businesses to be more socially responsible to protect families, workers, consumers, and the environment.

Unfortunately for them, reality sometimes exposes their empty, fear-mongering rhetoric. California's paid family leave helps employers increase productivity and profit and helps families struggle through the challenges of welcoming a new child into the world or caring for a sick parent. We can't let the corporate crusaders get away with calling family-friendly laws "job killers." They are, instead, life savers.