A proposal to mandate paid leave for workers is getting a cool reception from New Mexico business owners.
A task force assigned to develop a plan that requires workers to receive paid family and medical leave (PFML) is presenting a proposal to New Mexico lawmakers that would give New Mexico workers 12 weeks of paid family and medical leave.
The New Mexico Business Coalition recently conducted a survey with 79 small business owners in New Mexico regarding the New Mexico Paid Family Medical Leave Act (PFMLA). The results show the proposal would hurt their businesses as well as their employees.
“Overwhelmingly, business owners are completely opposed to this proposed legislation,” said New Mexico Business Coalition President Carla Sonntag told New Mexico Sun. “Some of the responses showed frustration with government officials for putting this proposal forward and others indicated anger towards the micromanagement and unwieldy demands of elected on business owners. Some of the respondents said they cannot afford this on top of paid sick leave, after the Healthy Workplaces Act was signed into law in 2021 and went into effect on July 1, 2022.
Some of the respondents said they would close their business and/or move their business to another state that is business-friendly, said Sonntag, a longtime Albuquerque resident.
The federal FMLA guarantees the employee will have the same or an equivalent job after their return to work, but it does not require the employee to be paid while they are taking leave. Instead, employees use accumulated paid sick leave or vacation for pay while they are out. When asked if they support or oppose New Mexico’s proposal for mandated PFMLA that allows the employee to be paid from a state-administered Trust Fund, funded by quarterly employee and employer contributions, 94% of small business owners were opposed.
One business owner, who was not identified, responded to the survey that this could end up forcing him to lay people off.
“I offer full time workers four weeks of paid time off plus 40 hours continuing education. Any absence greater than that would create a need to hire help in order to serve existing customers,” he said. “A guaranteed job after a lengthy absence would require termination of someone to avoid costly excess employees.”
Another also responded in the survey that there could be ramifications if it goes into effect.
“We already offer PTO for this. A position is only worth paying for to the point of its value. If an additional financial burden is placed on that position, the remedy to keep the overall cost the same is to lower the hourly pay. I think employees would rather have a higher hourly wage than be given this benefit.”
The proposed legislation would require employees to contribute half a percent of their earnings — around $5 for every $1,000 they make. This would be very difficult for small businesses to stay afloat.
“Small business is under enough strain and tracking of sick pay and other information for the government. This would be difficult at best to keep on top of more regulations,” someone wrote in the survey.
When asked for additional comments at the end of the survey, another person wrote: “Instead of this program, focus on improving the economic environment of the state to lead to job and wage growth, and a more prosperous population that will be able to handle things on their own when family needs come along.”
The New Mexico Business Coalition (NMBC) was formed to provide a strong voice for business owners and entrepreneurs in New Mexico, Sonntag said.
“As a business owner, I understand how difficult it is to do business in New Mexico,” she said. “I was asked to serve on the task force that was reviewing potential legislation for a Paid Family Medical Leave Act. As I served and thoroughly reviewed the proposed legislation, it became abundantly clear that this would create yet another hardship on business owners. Instead of voicing my opinion alone, I felt it would be best to ask other business owners and top level managers their thoughts on the proposed legislation.”
NMBC conducted the survey of its business members as well as the business members of two other associations, she said.
“Based on the survey feedback, I think we will see additional businesses close or constrict their business operations in New Mexico,” Sonntag said. “I also believe this will be yet one more deterrent for new businesses to move or relocate to New Mexico. If this becomes a driver to further restrict our economy, it will place additional burdens on other taxpayers in the state because history indicates that state government will undoubtedly look to taxpayers to cover the shortfall for their ever-expanding budgets.”