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California workers to see increased paid family leave benefits under new law
By MADISON HIRNEISEN
THE CENTER SQUARE
(The Center Square) – On the final day to sign bills passed during the legislative session, Gov. Gavin Newsom signed a new law Friday that will increase the share of wages employers must pay lower-income workers who take paid family leave.
Signed into law by Gov. Newsom Friday, Senate Bill 951 will increase the amount of the employee’s wages an employer must pay to lower-income workers who take time off to care for a sick family member or bond with a child within a year after their birth.
Starting Jan. 1, 2025, the new law will increase the wage replacement rate to 90% for workers making less than $57,000, and all other workers would receive 70%, according to the bill’s author, Sen. María Elena Durazo, D-Los Angeles. The current rate is 60-70% depending on income.
“Twenty years ago, California paved the way in establishing the first paid family leave program in the nation,” Sen. Durazo said in a statement Friday. “Today, we reaffirm our commitment to supporting our lower-income workers and making sure Paid Family Leave and State Disability Insurance are accessible to them when they need it most.”
The bill was backed by a broad coalition of women’s associations and labor unions, who said the measure was critical to ensure low-income workers can access the benefits that they pay for.
The state’s Paid Family Leave program is funded by California workers through a State Disability Insurance payroll tax deduction, which is a 1.1% contribution per paycheck. Workers are eligible for Paid Family Leave if they are a part-time or full-time public or private sector employee who contributed to the State Disability Insurance program in the last 18 months, according to the Employment Development Department.
A report released this year by the EDD estimated that the Paid Family Leave Program provides 14.4 million workers with benefits, down from 18.8 million in 2019 due to the pandemic.
Supporters of SB 951 argued that the previous wage replacement rate was too low for workers to afford to take the leave.
“Until now, workers in low-paid jobs haven’t had meaningful choices when it comes to caring for newborns; we go back to work before our babies or our bodies are ready because there is no alternative that works when our families need food and shelter,” said Maria Bernal, a Sacramento-area fast food worker and participant in the Fight for $15. “This new law gives me hope that working moms like me can spend this important time together without sacrificing diapers, formula and other things babies need to thrive.”
Eleven states, including California, offer paid family leave, all of which are funded by employee-paid payroll taxes, according to the National Conference of State Legislatures. Despite California being the first state to enact a Paid Family Leave program, its benefits “fall short of those offered by most other similar state programs,” according to an analysis from the California Budget & Policy Center.
In a statement Friday, Gov. Newsom called the bill signing “an important step to ensure more low-wage workers, many of them women and people of color, can access the time off they’ve earned while still providing for their family.”
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