Proposed Family Leave Expansion Draws Business Fire

Business groups are reacting sharply in opposition to President Clinton's announcement Nov. 30 of new family-leave regulations by the Dept. of Labor that would allow states to make unemployment-insurance (UI) payments to parents of newborn or newly adopted children. "These regulations undermine the purpose and the solvency of the current unemployment system. If implemented by the states, they will add substantial costs to the UI system for a broader class of workers than contemplated by the current system," says Edward F. Potter, president of the Employment Policy Foundation, an employer group based in Washington, D.C. He points out that just last year -- even before the new regulations -- the Labor Dept. predicted that a recession similar to the one in the early 1980s would force 25 to 30 states to borrow between $20 billion and $25 billion to keep their UI systems solvent. "With the release of the regulations, the nation's UI system -- the safety net for workers who lose their jobs -- faces imminent danger," echoes Eric Oxfeld, President of UWC--Strategic Services on Unemployment and Workers' Compensation, Washington, D.C., also a business coalition. The group has launched a campaign to stop the proposal. Joining the campaign is another Washington, D.C., alliance, the Family & Medical Leave Act (FMLA) Technical Corrections Coalition. "We're not going to let them [the Administration] get away with this," pledges its executive director, Deanna Gelak. "When Congress debated the FMLA, it made a conscious decision not to require paid leave. If the Administration believes that the fundamental nature of the UI system should be changed to include an entirely different program, it should ask Congress and the American people, not try to sneak through the regulatory back door by unilaterally modifying the scope of the federal unemployment law when Congress is out of town."