Our wonky word Wednesday series on paid leave continues this week with wage replacement.
No matter where you start, if you begin to research paid leave policies in the U.S and around the world, you’ll come across the words wage replacement. This is just a fancy way of saying that employees with access to paid leave receive a portion of their wage or income while on leave in order to help make ends meet – it replaces their wages.
You may remember from our Wonky Word Wednesday post on the Family Medical and Leave Act (FMLA) that this legislation provides eligible employees up to 12 weeks of unpaid and job protected leave to care for a newborn, a sick family member, or to recover from a serious illness. However, 40% of the American workforce is not eligible for FMLA benefits. They do not qualify usually because they are part-time workers or are employed by a small business and by small business we mean 50 or fewer employees. Even among those who do qualify, 46% have stated that they could not take unpaid leave because of financial reasons and needed some form of wage replacement while on leave.
It is important to keep in mind which countries do not provide any form of paid leave – USA, Papua New Guinea, and Suriname. (That’s just embarrassing.) As a result, states like California, New Jersey, Rhode Island, and Washington have initiated their own programs to enable families to balance work and home demands. These states offer the following wage replacement benefits:
We are going to keep this train going for quite a while, so stay tuned to learn more wonky words related to paid family and medical leave and keep following our blog to see the myriad ways in which paid leave benefits families, businesses, and the economy.