Paid Family Medical Leave: The High Cost of the “Grand Bargain” for Employers - Pt. 1

Part 1: The Insurmountable Retaliation Provision

In June 2018, Massachusetts enacted the “Grand Bargain” legislation, which included a new law for Paid Family Medical Leave (“PFML”). Though labeled a “compromise bill” by the Commonwealth, Legislators chose to focus on employee/employer contribution allocations, leaving much of the original, special-interest sponsored PFML referendum language intact within the statute. As a result, the PFML as passed is unworkable for Commonwealth employers, and ripe for employee abuse of the generous leave and pay provisions.

This is the first in a series of articles that will highlight several problems with implementing the PFML, and propose solutions to the impractical statutory provisions.

PFML Basics

For those unfamiliar with the PFML law, Massachusetts’ version of paid leave affords far greater benefits than the Federal Family and Medal Leave Act (“FMLA”). Beginning in January 2021, Massachusetts employees will be entitled to:

  • Twenty (20) weeks of PFML per benefit year for serious health conditions that incapacitate them from working;
  • Twelve (12) weeks of PFML per benefit year related to the birth, adoption, or foster care placement of a child, or because of a qualifying exigency arising out of a family member being on active duty, or has been notified of an impending call to active duty in the Armed Forces; or
  • Twenty-six (26) weeks of PFML per benefit year to care for a family member who is a covered servicemember.

Not only does PFML provide eight (8) additional weeks of leave over FMLA for an employee’s own serious medical condition, employees can take that leave on an intermittent basis for most eligible leaves. Thus, an employee working a standard 5-day workweek has 100 working days every benefit year to take paid PFML leave. And, employees can take PFML leave for significantly more “family members” than allowed under FMLA, including time off for grandparents, grandchildren, parent-in-law, and domestic partners with serious medical conditions.

Depending on the employee’s earnings, employees on PFML can receive up to $850 per week in paid benefits.

Beginning October 1, 2019, Massachusetts employers must start payroll and wage withholdings. These withholdings, along with employer payments (where applicable), will be remitted on a quarterly basis to the Department overseeing employee payments under the PFML law.

PFML Problem # 1 – The Insurmountable Retaliation Provision.

One of the foremost problems for employers is the PFML’s retaliation provision. Under this clause, an employer is presumed to have retaliated against the employee should there be a “negative change in the seniority, status, employment benefits, pay or other terms or conditions of employment” within six months of that employee taking any amount of PFML leave (or participating in PFML-related proceedings or inquiries). Critically, the employer’s motive is irrelevant as there is no requirement to prove an employer’s retaliatory intent or animus. Once facts supporting a “negative change” are shown, employers can only avoid liability (which include treble damages and attorneys’ fees) through proving by “clear and convincing evidence” that the purported “negative change” was not in retaliation to taking PFML leave. But that clear and convincing proof is absent in most employment-related business judgment decisions.

Consider, for example, two employees applying for the same promotion or lateral move, both of whom are relatively equal in performance and tenure. Only one of the employees, however, took PFML leave within the past six months. Because not choosing an employee for promotion or lateral move could be considered a “negative change,” the employer must chose the employee who took PFML or risk a lawsuit, and face a significant damages ruling – and associated negative publicity – because no employer is likely to prove by clear and convincing evidence why it chose one person over the other given their near equal experience. Thus, as a consequence of the law, commonplace business judgment scenarios like this example will be ripe for litigation, paralyzing companies from making everyday employment-related decisions.

Such outcomes go against the Massachusetts Supreme Court’s opinion that the “task [of discrimination statutes] is not to evaluate the soundness of [a company’s] decision making, but to ensure it does not mask discriminatory animus.” Sullivan v. Liberty Mut. Ins. Co., 444 Mass. 34, 56 (2005). And, contravene the Court’s wariness to act “as super personnel departments, assessing the merits – or even the rationality – of employers’ nondiscriminatory business decisions.” Id. (quotes and citations omitted).

Solution to PFML Problem # 1 – Implement the McDonnell Douglas Standard.

Massachusetts corporations face a future filled with continual second-guessing of common employment decisions and unwarranted litigation. To avoid the statutory overreach noted above, the PFML retaliation provision should be modified. Specifically, the retaliation presumption and clear and convincing evidence standard could be replaced with language that employs the McDonnell Douglas test for all retaliation claims. This established and proven method to assess retaliation and discrimination claims would allow courts to properly evaluate a company’s intent and retaliatory animus, and avoid turning courts into personal department review boards.

This article was originally published in the Bristol County Chamber of Commerce Business News for September 2019.