Democrats Likely To Drop Paid Sick Leave From COVID-19 Rescue Bill

Without Republican support, Democrats can't require companies to provide paid time off to workers — just some weak tax credits instead.

There’s unlikely to be any formal paid sick leave in the latest COVID-19 rescue bill unless at least 10 Republicans sign on to it, despite the policy’s proven effectiveness in slowing the spread of the coronavirus, according to three congressional aides who spoke to HuffPost.

Without Republican support, Democrats will also likely have to leave out paid family and medical leave, illustrating the limitations of Democrats’ razor-thin majority in such a deeply partisan Congress.

Democratic aides said they didn’t see a way to include a requirement that companies provide paid leave under the constraints of budget reconciliation, a legislative process Democrats are pursuing to pass legislation in the Senate with only a simple majority.

“We knew a mandate would never survive [under Senate rules],” said one Democratic House aide. “It’s not like we didn’t expect it.”

At best, the package would include tax credits for small businesses that opt to offer employees paid time off. A more substantive leave policy that passed with bipartisan support back in March 2020 did require some companies to provide paid leave. It expired at the end of last year.

“It is what it is,” said a Democratic Senate aide, who wasn’t authorized to speak publicly about the state of negotiations. The aide said that it was still a good sign that tax credits will be included in the package, calling that “momentum.”

Though the details are still being worked out, the tax credits would likely be available only to small companies. These businesses would get some money back for giving workers paid time off to deal with COVID-19 issues. But it’s not clear if companies would even be required to let workers know such leave is available to them.

Most progressives don’t see these tax breaks as anything close to legitimate paid sick leave, but simply an extension of the status quo. The U.S., unlike most other developed nations, does not mandate paid sick leave, so few companies offer it — and typically only to fairly well-paid white collar workers.

Congress’s failure to include paid sick leave during a pandemic has frustrated progressive advocates. Paid sick and family leave is needed for a raft of critical reasons: First, it would allow workers exposed to COVID-19 to stay home to quarantine or recover from their illness, thus preventing the spread of the disease. The leave could also give workers time off to go get vaccinated. And longer-term family leave is critical to parents who need to be home with children because of school and day care closures. Already millions of women were pushed out of the labor force to deal with that pressure.

“It remains deeply disappointing and utterly incomprehensible that Democrats and Republicans can’t come together around a public health policy that would prevent COVID cases.”

- Vicki Shabo, New America paid leave specialist

The rescue package floated by 10 Republican senators last week, countering Biden’s opening proposal, entirely omitted the policy.

Advocates call it a wasted opportunity.

“It remains deeply disappointing and utterly incomprehensible that Democrats and Republicans can’t come together around a public health policy that would prevent COVID cases, help the vaccination process and help keep people in the workforce,” said Vicki Shabo, a paid-leave specialist at the New America think tank. “Especially women and people of color.”

With 50 seats in the Senate, and Vice President Kamala Harris as the tie-breaking vote, Democrats can pass their relief bill without any Republican support through budget reconciliation — a process they started this week. Otherwise, any bill passed by the Senate needs 60 votes to overcome a filibuster.

But while bypassing Republicans means Democrats can get a lot of things their colleagues across the aisle have balked at, reconciliation comes with some tradeoffs.

Reconciliation bills must directly impact federal spending or revenue, and they also cannot raise the deficit beyond a certain threshold over the next 10 years. In this case, Senate Democrats put that top-line figure at $1.9 trillion.

A blanket paid leave requirement, or mandate, doesn’t directly impact the budget, and therefore would run afoul of Senate rules. Democrats haven’t yet decided whether they will include the mandate in their final bill text and simply subject it to an objection from a Republican colleague on the Senate floor.

There are some workarounds. Democrats are pursuing one in this emergency relief push, structuring a paid-leave tax credit for some businesses similar to one that passed back in December.

“In the event the mandate can’t survive through reconciliation, Democrats are budgeting to continue the voluntary credits from the December deal,” a Democratic aide familiar with the talks said.

But without requiring companies to actually give employees paid time off, these tax credits just don’t amount to much.

Last year, Congress did have bipartisan momentum around leave, and was able to mandate that some businesses offer paid sick leave to deal with the coronavirus.

Democrats had hoped for a national paid sick leave mandate in the latest round of COVID-19 relief, but that is now looking unlikely given their use of restrictive Senate rules to avoid a Republican filibuster.
Democrats had hoped for a national paid sick leave mandate in the latest round of COVID-19 relief, but that is now looking unlikely given their use of restrictive Senate rules to avoid a Republican filibuster.
Caroline Brehman via Getty Images

It was far from an ideal policy. Under White House pressure, Republicans carved out a huge exemption for big businesses. Those with more than 500 employees didn’t have to offer paid sick leave at all; that meant essential workers at places like Amazon and Walmart were entirely left out. There were also loopholes involving health care workers.

All told, as many as 106 million workers were excluded, according to one estimate. There haven’t been many studies detailing the impact of those carveouts. However, we do know that millions of women were forced out of the labor market last year in part because they needed to be home with children due to school closures. A paid leave policy could have kept those women attached to their jobs — allowing them to take time off to support children home from school, instead of abandoning work wholesale.

But even those restrictions were not enough for Republicans. As the leave was expiring in December, then-Senate Majority Leader Mitch McConnell (R-Ky.) and Sen. Lamar Alexander (R-Tenn.) blocked an extension of the leave in negotiations. Along with most Republican senators, they had soured on the idea of forcing businesses to provide the time off.

At the time, now-incoming chair of the Senate Health, Education, Labor and Pensions Committee, Sen. Patty Murray (D-Wash.), said she would fight for the policy once Biden was inaugurated. But it seems Democrats will likely have to kick this fight down the road once again.

Murray plans to focus on the need for paid leave at a committee hearing to consider the nomination of Marty Walsh for labor secretary on Thursday, an aide to Murray told HuffPost.

Republicans are out of step with even the business world on this one. Just this week, the U.S. Chamber of Commerce, a conservative-leaning lobbying group, endorsed the idea of paid sick and family leave as it was structured in the expired legislation.

The leave that passed last year was effective in slowing the spread of disease, according to a study in the journal Health Affairs. Several small-business owners also told HuffPost last year that the policy was a lifesaver, helping them hold on to employees and stay in business amid the pandemic.

The Biden White House had wanted to expand and extend paid sick and family leave in this latest rescue package, proposing a policy that would cover all workers and increase the benefit provided to them.

Three congressional Democratic aides said they hoped it could be passed with Congress’s next big legislative package — what the Biden’s administration is teasing as a jobs and infrastructure plan that would go beyond emergency COVID-19 relief.

But it’s not entirely clear that Republicans will be on board for that slate of bills either. If Democrats are forced once again to resort to another budget reconciliation package to pass their agenda, they will hit the same snag with paid leave ― though congressional aides said they might be able to figure out a workaround with a longer lead time.

Shabo, from New America, is convinced it is possible to pass paid leave through the reconciliation process if lawmakers change the way the policy is structured.

“Not only is it technically doable within the Senate’s reconciliation rules, it would be a real tragedy if they don’t,” she said. “How can you ‘build back better’ after a pandemic like this ― and after the exacerbation of disparities that already existed before by gender, race and job ― without creating a national paid leave program, along with child care and long-term care supports?”

Democrats are facing similar complications around their desire to raise the minimum wage; it remains up for debate whether such a policy would significantly impact the federal budget in order to pass muster under Senate rules.

For now, Sen. Kirsten Gillibrand (D-N.Y.) and Rep. Rosa DeLauro (D-Conn.) are soon expected to reintroduce their own permanent paid leave bill, the Family Act. The hope is that the legislation, which is structured differently than the emergency leave provisions, will garner 60 votes in the Senate.

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