The Vermont Senate approved legislation Wednesday that would create a mandatory paid family leave program for workers, funded through a 0.2 percent payroll tax.

The bill, H.107, would allow Vermont workers to be paid for up to 12 weeks of “bonding leave” after the birth or adoption of a child, or for six weeks to care for a sick or injured family member. The program would be run by a private insurance company and would pay workers at 90 percent of their earnings up to $27,000 per year, and 55 percent of additional earnings.

Before the Senate voted 19-10 to advance the bill, Sen. Michael Sirotkin (D-Chittenden) said the program would cost about $30.5 million a year. Of the 0.2 percent payroll tax, businesses and employees would each pay half.

The House passed a version of the bill in April. But in order to keep program costs down, Senators cut a House-approved provision that would have allowed workers to take paid time off for their own illness or injury.

That policy difference would have to be worked out before the bill can go to Gov. Phil Scott for approval or a veto.

In January, Scott proposed a paid family leave program in partnership with New Hampshire Republican Gov. Chris Sununu which would be optional for most Vermont workers but would automatically enroll state workers. Legislative Democrats rejected that plan because, they said, the risk pool of a voluntary program would be so small that it could become financially unsustainable.
Scott continues to push for his plan, which he says would provide Vermonters with a valuable benefit without raising taxes.

Sen. Randy Brock (R-Franklin) said during the Senate debate on the bill that he understands the flaws in a voluntary policy, but he objected to a mandatory payroll tax to fund the paid family leave program.

“This is a plan that thousands of people don’t want and can’t use, and it’s being forced down their throats,” Brock said, noting that workers who never have children and don’t have living family members would pay into the program without ever being eligible to benefit.

Sen. Jane Kitchel (D-Caledonia) told colleagues that she supports the concept of paid leave, but that her work as chair of the Senate Appropriations Committee has shown her that existing programs are too underfunded to set up a new tax collecting tens of millions of dollars for something else.

For example, Kitchel said, “we talk about the importance of higher ed and yet we are funding our higher ed system at a level that’s kind of at the bottom of the nation.”

Without fully funding existing programs, Kitchel said she couldn't support a new one.

“This is taking revenue that will never be available and therefore I view it as putting at risk, or [threatening], our ability to ever address the commitments that we are failing to fulfill,” she said.

The House passed its version of the legislation in a 92-52 vote, which isn't enough of a margin to reach the two-thirds majority needed to overcome a veto from Scott. The Senate's 19-10 vote took place without Sen. Bobby Starr (D-Essex/Orleans), leaving some uncertainty about that chamber's ability to override a potential veto.