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EMPLOYMENT LAW UPDATE

Three White House announcements for employers

President Biden calls on employers to provide paid time off for employees to get vaccinated

In a White House press release dated April 21, 2021, President Biden called “on every employer in America to offer full pay to their employees for any time off needed to get vaccinated and for any time it takes to recover from the after-effects of vaccination.” The White House statement adds that President Biden will announce “a paid leave tax credit that will offset the cost for employers with fewer than 500 employees to provide full payment for any time their employees need to get a COVID-19 vaccination or recover from that vaccination.”

By Executive Order, President Biden increases the minimum wage for federal contractors to $15/hour

On April 27 President Biden signed an executive order to increase the minimum wage paid to employees of federal contractors from $10.95 per hour to $15 per hour. Additionally, starting in 2022, the minimum wage for federal contractor employees will be automatically adjusted to reflect the cost of living changes. The increase is not immediately effective. Instead, the order requires all federal agencies to incorporate a $15 minimum wage in all contract solicitations starting January 30, 2022, and into all newly signed contracts by March 30, 2022. Existing federal contracts will not be impacted until those contracts are renewed on or after March 30, 2022. Although the order applies only to federal contractors, watch for ripple effects when other employers have to compete with federal contractors for employees.

President Biden announces American Families Plan that Includes paid family and medical leave proposal

On April 28, 2021, during his statement to Congress, President Biden announced his “American Families Plan,” which if successful, would provide paid family and medical leave to American workers. According to a White House statement, the “program will ensure workers receive partial wage replacement to take time to bond with a new child, care for a seriously ill loved one, deal with a loved one’s military deployment, find safety from sexual assault, stalking, or domestic violence, heal from their own serious illness, or take time to deal with the death of a loved one. It will guarantee 12 weeks of paid parental, family, and personal illness/safe leave by year 10 of the program, and also ensure workers get three days of bereavement leave per year starting in year one. The program will provide workers up to $4,000 a month, with a minimum of two-thirds of average weekly wages replaced, rising to 80 percent for the lowest wage workers.” The White House estimates this paid leave program will cost $225 billion over its first 10 years. Although the White House statement on the American Families Plan does not include details on who will pay for this leave, it appears that President Biden hopes to pay for it through tax increases on the wealthiest Americans, rather than through any sort of payroll tax or requirement that employers pay such leave directly. Of course, thanks to the Senate filibuster, President Biden likely will need at least 10 Senate Republicans to sign off on his plan to close off debate and bring the matter to a floor vote in the Senate. In other words, compromises likely will need to be made for paid family and medical leave to become a reality.

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