Dek: The voluntary system strives to reach a broader demographic

By Kelly Burch, Correspondent

A year into New Hampshire's unique voluntary Paid Family Leave and Medical Leave Program, questions remain about its ability to reach a significant number of workers, especially many of the people who need it most.

"Everyone is asking: Is this a viable delivery method,” said Kristen Smith, visiting associate professor of Sociology at Dartmouth College, whose research focuses on work and family policy.

Most states with paid family and medical leave, Smith explained, have a universal program where employers are required to participate. After Gov. Chris Sununu vetoed that type of leave program in 2019, lawmakers switched tack, passing the nation’s first voluntary paid family leave program, a system for which there is no prior data, according to Smith.

Participants in the state’s family and medical leave program are comprised of three groups: those who purchase insurance as individuals; those whose employers voluntarily enroll them in the program and state employees.

Last year, of the approximate 17,644 statewide participants, 8,800 were state workers, 9,000 were enrolled by 210 employers and just 644 were individuals.

“We’re hoping… that we’ll see those numbers go up,” said Rich Lavers, deputy commissioner with the state’s Department of Employment Security, which helps operate the system. 

The state is currently enrolling individuals who don’t have paid family leave through their employer during its annual open enrollment period which runs until Jan. 29. Workers can purchase their own plan through a private insurance company with premiums capped at $5 per week. 

The program is available to any workers who receive a W2 tax form, but it’s not available to most gig workers, Lavers said. That’s because reimbursement is based on hourly wages. Gig workers, who make up about 36 percent of workers nationally, aren’t paid hourly, so they don’t fit into the current framework of the program. To change that, the legislature would need to alter the laws governing the program, according to Lavers. 

The state Executive Council approved a four-year contract with an advertising firm in 2022 that allocates $1.9 million to publicize the program through social media, radio, television and other avenues, he said.

Smith said the state’s efforts seem to be paying off with increased public awareness of the program. Still, she added, with just under 3 percent of the state’s workforce covered by the program, “it’s going to fall short” of mandatory programs in terms of participation. 

In addition, the risk pool for the program may be skewed. For insurance to be profitable and affordable, the risk pool needs to be spread out, Smith explained. In addition to people who use their leave time, the pool needs those who are less likely to file claims.

“If you have a voluntary program, the argument is that only people who need leave will opt-in, and your risk pool will be unbalanced,” Smith said.

Early data show that may be the case in New Hampshire, especially among individuals who purchase plans themselves, rather than having plans provided by their employers. 

Last year, 80 percent of people who purchased individual plans were female and 60 percent were under the age of 45, Lavers said. 

This, along with the fact that 86 percent of claims among individuals were to care for a new child, indicates that individual leave policies are disproportionately purchased by workers expecting babies. 

“It’s dominated by young women,” Lavers said.

 “If we want to improve access and level this playing field, we need a program that’s comprehensive and inclusive,” Smith said. 

In addition to being voluntary, other aspects of New Hampshire’s program increase the challenge of reaching that goal.

For example, participants receive 60 percent of their wages for up to six weeks of annual absences from work to care for a family member or themselves.

Research shows that fathers are more likely to take leave when they’re reimbursed a higher percentage of their wages, Smith said. The 60 percent reimbursement rate under the New Hampshire program may make it difficult for fathers to take time off work, she said. 

The low reimbursement rate also impacts low-income people, who may not be able to survive on 60 percent of their typical wages, Smith added. 

Research from California, the first state to adopt a paid family leave program in 2004, shows that even when low-income workers have access to paid leave, they’re less likely to take it. In 2020, people making $80,000-$100,000 were four times more likely to take paid family leave than those making less than $20,000, according to the California Budget and Policy Center. 

Smith also worries about the current female-dominated distribution of individuals purchasing PFML policies. 

“If we have a program that has a concentrated number of women… that may reinforce gender stereotypes that women are the ones who take leave,” she said. That could reinforce the “mommy track”—the idea, supported by research, that employers are less likely to promote and retain women of childbearing age, worrying that they’ll spend more time off work as they raise families. 

Another challenge facing the New Hampshire program is that it doesn’t guarantee job security. If a person takes leave, but is not protected under federal Family and Medical Leave (FMLA) laws, they still risk being fired. That’s why it’s critical, Lavers said, that employees discuss their leave plans with their employer. 

"We stress with individuals, that they need to have a good line of communication with their employers,” he said. “The New Hampshire program doesn’t do anything to change job projection requirements.”

For the most part, he said, companies have been receptive to working with employers who want to take leave, and the employees who have opted into the program are glad to have it when they become injured, need to care for their aging parents, or take time off to bond with a new baby. 

“These life events that are the qualifying events for this program, they happen to all of us,” he said. 

The individual program is important for increasing access to paid family leave for workers whose employers don’t provide it. Nationally, about 25 percent of workers have access to paid family leave, but the rates are 12 percent or less among part-time workers and people working in lower-paying industries including hospitality, food service, and warehouse work, according to the Center for American Progress. 

Often, “the folks who need it the most are the ones who don’t have it,” said Smith.

To boost enrollment, California adopted a tiered reimbursement system that gives higher reimbursements to low-income workers. Such a system and increasing the amount of time that a worker can take would likely increase participation in New Hampshire, Smith said. 

These articles are being shared by partners in The Granite State News Collaborative. For more information visit collaborativenh.org.