Some small business owners see paid leave proposal as a boon to hiring

By: - March 6, 2023 6:30 am
Mother using laptop computer as she cares for baby

A budget provision proposed by Gov. Tony Evers would create a state paid leave program for workers who need health care or to care for a loved one. (Getty Images)

In 2012 when they were living in Canada, William and Nicole Green welcomed their first daughter into the world, and Nicole, a Canadian citizen, was able to take a year off from work with pay.

Two years later they were living in Wisconsin when their second daughter was born. The available time off was just 12 weeks — without pay.

A decade later, the Greens still think about that contrast, with an added twist: They’re business owners themselves, operating Fox City Flix,  a fledgling entertainment enterprise that rents video projection equipment and sound systems for events in people’s homes or businesses. 

Both work other jobs full time while growing the business, which is now in its fourth year of operation. They anticipate adding some employees this year, Green says. But they also wonder what will happen when an employee needs to take time off to recover from an illness, care for a newborn child or assist with an aging relative. 

Now that he’s experienced first-hand what is possible elsewhere, Green asks, “How do we provide that same level of resources to our employees down the road?”

That has made the Greens advocates for one of the provisions in the 2023-25 proposed budget that Gov. Tony Evers introduced in February: a 12-week paid leave program for Wisconsin workers funded by a payroll deduction levied equally on employees and employers.

The governor’s proposal also would expand the reach of the state’s current family and medical leave law. The current law only guarantees unpaid leave, and applies only to personal illness, childbirth or adoption, or caring for an immediate family member who is ill.

In the U.S., 11 states and the District of Columbia have enacted some form of paid leave legislation that includes personal sick leave as well as family leave, according to the U.S. Labor Department.  Another three states have instituted voluntary social insurance programs for paid family leave.

Democrats, worker advocates and some small business groups had hoped to see a national paid leave provision in the legislation President Joe Biden advanced in 2021, but it was one of many items left out of the final version of the bill, the Inflation Reduction Act, which Biden signed in August 2022 after it passed Congress with only Democratic votes.

At the Republican press conference the evening of Evers’ February budget address, Senate Majority Leader Devin LeMahieu (R-Oostburg) said the inclusion of Evers’ paid leave proposal once the budget goes through the Legislature was unlikely.

Despite that, however, paid leave advocates say they see potential openings.

After the U.S. Supreme Court overturned a national right to abortion in June 2022, some Republicans and anti-abortion advocacy groups began expressing support for paid leave. In a debate ahead of the August GOP gubernatorial primary, both Tim Michels and Rebecca Kleefisch spoke favorably of requiring employers to provide workers paid family leave. 

And in the Marquette University Law School poll released a week before the election in November, majorities of Democrats and Republicans surveyed said they would favor a state law requiring paid leave for mothers and fathers of newborns.

Rep. Francesca Hong (Assembly web page photo)

“This has broad support across small business owners, large business owners and folks who are ideologically opposed on the political spectrum,” says Rep. Francesca Hong (D-Madison). “So I think that there is a strong possibility that we’re going to at least debate this issue” in the current session of the Legislature. 

“I believe that it will be [an issue] that will have strong bipartisan support, both on the grassroots level on the legislative level, as well as across different sectors of our economy,” Hong adds.

Evers’ proposal calls for a program that would provide up to 12 weeks of paid family and medical leave. Leave would be paid for through a new trust fund built from equal payroll contributions by employers and employees. The governor’s plan calls for a $243 million start-up contribution by the state to seed the fund in its first year.

The proposal differs from a paid leave bill that Democrats introduced late in the last two-year legislative session, which was funded by employee contributions alone. 

Hong, a restaurateur as well as a member of the Wisconsin Assembly, says that her long-standing concerns about how small businesses could be encouraged to support their employees were underlined by the COVID-19 pandemic.

“There were people leaving the industry,” prompting conversations among restaurant operators about how to make the jobs they offered “more of a career,” she says. “And if we had the option to offer folks paid leave, how we could not only diversify our workforce, but as a small business, really make the investments needed in our employees and save on turnover costs. It’s a win for everyone.”

Irene Strohbeen, a small business consultant in Menasha, recalled the contrast she saw when her oldest child was born more than 30 years ago. At the time she worked for a large multinational company. 

“We were all welcome to take leave without pay,” Strohbeen says. In the company’s London offices, meanwhile, colleagues were taking longer, paid leaves that were required by law. 

“We dug into savings and I stayed home as long as I could,” she says. “But nothing compared to how our European counterparts were taking parental leave.”

Advocates see paid leave as a benefit that can draw more people into the workforce, and more potential workers to Wisconsin if enacted here.

“The lack of investment in the care economy has made it detrimental for employers to be able to stay competitive and retain and invest in their employees,” says Hong. “We’re the only industrialized country that does not have a nationwide policy on this.”

The paid leave provision is among the priorities that Main Street Alliance, an advocacy group for small business owners, has been promoting ahead of the Legislature’s budget deliberations. 

Green says he’s talked with lawmakers and their staff about the issue, including during a day-long visit to the Capitol that Main Street Alliance organized in February, where he met with an aide to Sen. Rachel Cabral-Guevara (R-Appleton). “Those folks have been very open to hearing from us as constituents,” he says. “We hope that these conversations continue.”


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Erik Gunn
Erik Gunn

Deputy Editor Erik Gunn reports and writes on work and the economy, health policy and related subjects, for the Wisconsin Examiner. He spent 24 years as a freelance writer for Milwaukee Magazine, Isthmus, The Progressive, BNA Inc., and other publications, winning awards for investigative reporting, feature writing, beat coverage, business writing, and commentary.