Congress should recognize that leave policies for employees today exist in a carefully balanced environment where both the needs of employers and employees are considered.

BACKGROUND

A hotel’s employees are the greatest asset for any employer.  The benefits offered by both large and small lodging industry businesses to their employees vary from workplace to workplace.  One benefit in many workplaces is paid leave or time off.  It is often available for workplace absences ranging from illness, family obligations, or vacation.

While most employers seek to give their employees this benefit to recruit them into a position, or to retain their expertise after they become employees, other employers are unable to do so because of cost, employee preferences for other compensation, or workplace and job requirements that make providing paid leave to some or all employees particularly challenging. 

In today’s political environment, Congressional lawmakers have expressed legislative interest in expanding the availability of paid leave and/or flexible work arrangements.  However, the many proposals offered this Congressional session threaten U.S. economic competitiveness, job creation, and the ability of employers to design and offer compensation packages that are tailored to their employees.

Any of the proposed bills must meet these standards if the lodging industry is asked to support the legislation:

• Recognize employers who are offering generous paid leave programs.  The vast majority of employers voluntarily offer generous paid leave benefits. According to the U.S. Department of Labor, 82 percent of private employers currently offer some form of paid leave to their workforce. Any paid leave requirement should recognize these existing benefit offerings and provide these employers with a “safe harbor” from federal, state and local leave requirements.
• Recognize the disproportionate impact on small employers.  Over the years, Congress has recognized that their mandates have a larger impact on small businesses than large corporation and provided an exemption from federal requirements for smaller organizations.  Today’s economic crisis is threatening the viability of many small businesses who are struggling to avoid layoffs and closures. Any paid leave requirement from Congress should be scalable to the size of the employer in order to limit the financial burden on smaller employers.
• Foster leave flexibility for employers and employees.  Congress should ensure that any of their paid leave proposals are written for both employees and employers. Public policy should support and encourage open communication between employers and employees by asking for adequate notice be provided by both parties to ensure operations continue with as little disruption as possible. Moreover, employers and employees should work together to craft work schedules and tailor leave benefits for an individual workplace, so that when adequate notice is provided and responsibilities are met, paid leave benefits will not burden co-workers, customers, the general public, and employers.
• Ensure consistency and ease of recordkeeping.  Under current law, employers encounter challenges in navigating the various conflicting requirements of overlapping state and federal leave and disability laws. It is imperative that any proposal be consistent with other employment laws to ease employer compliance.  Definitions of full-time employees and part-time employees, along with who is an employee and who is an employer, must be consistent with existing federal employment laws.

CALL TO ACTION

The 111th Congress has several paid leave bills under consideration.

Healthy Families Act (H.R. 2460/S. 1152).   AH&LA opposes the Healthy Families Act (HFA) because of the adverse impact it will have on hospitality industry employees, employers, our guests, and the general public.

The Healthy Families Act (HFA) would mandate that employers with 15 or more employees provide a one-size-fits-all paid sick time mandate of up to 56 hours of paid sick time annually. A paid sick mandate would limit an employer’s flexibility in designing a compensation and benefits package that meets the needs of their unique workforce, resulting in significant costs for employers as well as a potential loss to employees who prefer other benefits rather than paid sick time. Moreover, the HFA seems to incorporate some of the Family and Medical Leave Act (FMLA) concepts that have caused the most significant problems for employers with respect to scheduling, including the ability to use this paid sick leave on an unscheduled basis, with little or no notice of an absence.

AH&LA is concerned that legislation jeopardizes employee’s wages, health care coverage and other important workplace benefits that could be reduced or eliminated in order to comply with this law.  Under the HFA, an employer’s workforce could fail to show up for work without advance notice, resulting in significant workplace disruptions and a negative impact on productivity and customer service.

The HFA adds to the growing patchwork of varying federal, state and local leave requirements.
Employers consistently report challenges in navigating the various conflicting requirements of overlapping state and federal leave and disability laws, including the FMLA, the Americans with Disabilities Act, and workers’ compensation laws. The HFA would only add to the already complex web of inconsistent but overlapping leave obligations under federal and state laws.

AH&LA and other industries who are part of the National Coalition to Protect Family Leave sent a joint letter to Congress on June 23, 2009, expressing their concerns about this bill.

Paid Vacation Act (H.R. 2564).  The proposed Paid Vacation Act would require at least one week of paid vacation for employees at companies with at least 100 employees.  Full- and part-time (25 hours per week/1,250 hours per year) workers will be eligible after one year of service. Three years after enactment, companies with at least 50 employees would be required to offer at least one week of paid vacation, and companies with at least 100 employees would be required to offer at least two weeks of paid vacation.  Outside groups pushing this bill have said they would like someday to see three weeks of paid vacation leave, much like what many European governments enforce on their country's businesses today.

Because of the 50- and 100-employee thresholds in the bill, most small businesses would not be directly affected by the bill immediately.  However, small businesses could be forced to tailor their workforce hiring as to not be affected by the thresholds.  The Paid Vacation Act would amend the Fair Labor Standards Act (FLSA), which means enforcement will be handled by the Dept. of Labor, just like it does for all federal wage and hour laws. 

This legislation is a paid leave bill but with a more undefined definition of "leave".  AH&LA presently does not have a position on this legislation but is studying its impact on the industry.

(Updated July 2009)

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