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State budget surplus sparks renewed push for paid leave

News of a $7 billion projected surplus buoys hopes for paid family and sick leave in Minnesota.

MINNEAPOLIS — Supporters of paid family and sick leave in Minnesota say they have renewed hope 2022 will be the year the lawmakers create a statewide system that could help people who work for companies that are too small to afford extended paid breaks.

The idea has been debated at the State Capitol for years, but news of a $7.7 billion projected budget surplus opens a window of opportunity that the state could afford the startup costs of such a system.

Sarah Piepenburg, a small business owner in Minneapolis, is among those who've been advocating for the system, which would eventually be an insurance fund run by the state and supported with small payroll deductions shared by employees and employers.

"It's an employer-employee paid-in program and it’s completely affordable," Piepenburg told KARE. "It’s a fraction of my employee’s salary that I pay in, that they can get up to 60 to 80 percent of their salary while they’re out recovering."

The House version of the bill in 2021 would pay 60 to 80% of an employee's wages for up to 12 weeks if they need time off for a birth, adoption, major illness or are caring for a sick family member.  It would be paid for with a payroll deduction of 6/10ths of 1% of the worker's pay, with half paid by the employee and half by the employer.

"As a small business owner, we truly value those employees. We would love to be able to offer them more, but again, what’s available on the private market, especially to such a small business like myself, is completely unaffordable."

Piepenburg and her husband own Vinaigrette, an artisanal olive oil and vinegar shop in southwest Minneapolis.  While she has a background working the human resources field, she became an advocate when one of her employees was injured away from work and needed eight weeks to recover.

"I said I need you to get better. I also know that you need this job to make your ends meet," Piepenburg recalled.

Paying Linda during her recovery left Piepenburg's business and family temporarily strapped for cash.

"We were late on our commercial mortgage and we were late on our home mortgage as a result, but I knew it would come back to us once she came back to us and could work again."

The employee, Linda, did return. But she recently passed away as a result of ALS.

"This last year and a half I’ve spent carrying for her. She has subsequently passed away. But that’s how critical our employees are."

Gov. Tim Walz and DEED Commissioner Steven Groves Wednesday held a roundtable discussion at Piepenburg's store.

The governor noted that statewide paid leave system would help small businesses compete with larger companies that can afford leave already. He also mentioned how it would drive down healthcare costs for employees to be able to care for sick loved ones.

Commissioner Groves cited studies showing how important early childhood development is to people's ultimate success later in life, asserting it should be considered an investment in the state's future.

The idea still faces an uphill battle at the State Capitol because the Senate Republican majority has consistently opposed anything that expands the role of state government especially in the arena of private businesses.

The Minnesota Chamber of Commerce remains opposed to the idea, asserting that businesses should be able to design the benefit plans that best fit their companies and their employees' needs.

As of 2021 a total of nine US states and the District of Columbia have approved paid leave plans, but the Chamber says the one proposed by the House DFL members last year would be more generous than what is offered in most states.

Sarah Piepenburg conceded that replacing an employee that's on paid leave may present a challenge to some companies, but she said the cost of hiring and training a new employee is far greater than holding a job for someone who needs to take an extended break.

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