The Family Leave Debacle

The Family Leave Act, now one-year old, has quietly changed the character of American business life for the worse. It has introduced new confusion among employers, created new disincentives to hire, and generated new hostilities in the workplace. Like other mandates, it has created new classes of beneficiaries and victims, who have turned on each other instead of on the real enemy in Washington.

The idea for the law came from observing how childbirth affects the professional woman. No one wants to throw a newborn into daycare, but the official culture exalts the fun-time career women, even if she is also a mother, and denigrates mothers who can afford to choose other paths. Yet few employers, as much as they might like to, can afford to give three months off for every child.

The mandate lobby had an answer, as they always do: pass a law! By the time the legislation was in final form, it covered not only mothers but also fathers and parents of adopted or foster children. And since we couldn't discriminate against the childless, anyone who is sick, or has a sick relative, can also take twelve weeks off.

Once the law was passed, businesses found that their internal policies concerning vacation time, along with informal sick-leave arrangements, were overridden. The central government knows what companies should and should not do, so all contrary plans were wiped out in the stroke of the presidential pen.

Businesses with 50 or more employees found they had to give three months off to anyone who claimed to qualify or face expensive lawsuits. The business also must promise to hire the person back at the old position, salary, and benefits. But this isn't "unpaid" leave, as supporters claim. The government requires the employer to continue to pay health benefits.

And that's only the beginning. If an employee does highly valued work, three months of absence can be devastating to the firm. There is no point in training a new person for the job. In practice, the employer hires a temporary worker and cajoles other employees into increasing their workloads.

Everyone is willing to help a friend in need, but this is unfair discrimination against other workers. They pay a clandestine tax from which others benefit, which is the source of a new employee conflict now burdening enterprise.

Men are much less likely to take this kind of leave, of course. But a man's chivalrous obligations can be pushed too far. When men have filled in for enough free riders, they too may discover a pressing reason to take three months off. Through this sort of game playing, workplace cooperation becomes a dog-eat-dog competition for leisure rights.

Employees are in one day and out the next, only to demand the same position and pay three months hence, plus no "discrimination" in promotions and perks. You can't run a business this way.

Employers can forget about challenging the demands for time off. The Labor Department is absurdly biased. But then, in a spirit of solidarity, government bureaucrats can always be counted on to support non-work.

If employers could speak their minds without fear, they would tell you that the Family Leave Act has even changed the way they shop for employees. Let's say two qualified candidates interview for one job. The first id a single woman with no apparent marriage intentions. The second is a new bride. On the margin, an employer will choose the unmarried woman because she's less likely to use Family Leave. Of course, this is illegal discrimination, but employers have to run their business, even when it means taking risks.

From an economic perspective, business mandates confer no benefits on employees as a group. All benefits – whether medical insurance, vacation time, unpaid leave, day care, or crack therapy – must necessarily be subtracted from wages and salaries. But there is a redistribution effect. Under the Family Leave Act, some employees get hit without a benefit, while others benefit without paying the price.

This injurious piece of legislation would never have passed had not "family-values" Republicans supported it as a legitimate intervention in the free market.

Employers, they claim, have social obligations. But Spanish moral theologian and economic theorist Luis de Molina dealt with that question more than 400 years ago. The only obligation of employers, he said, is to pay a "just wage," that is, the wage "customarily set in that region at that time," i.e., the market wage.

That wage, wrote Molina, "is not to be considered an unjust payment for that service or task because it is paid to an individual for whom it does not afford a living because he lacks other resources or employment, or because he has many children, or because he wishes to live at a high standard, or with a larger household than he would otherwise live."

"Under no circumstance," he warns, can employees "surreptitiously take something from their masters with the excuse that they are not sufficiently well paid." Now, of course, these unjust takings are done for them through legislation.

This is not to say that the family doesn't need help. Only thirty years ago, married middle-class women had the option of working or not. Today, inflation and taxation have forced them into the workforce. (The percentage of working single women has changed very little in more than 50 years.)

Rather than lobby for more mandated benefits, which only makes America poorer, we ought to increase the discretionary income of families through tax cuts and a massive increase in the child deduction. Repeal of the anti-discrimination laws that gum up the labor market would also be a boon to families.

We should seek to return to the days when saying "I do" meant that women could, if they wished, be liberated from wages and the professional grind. We need to bring back the days when a family could live on one salary, for in a free market, family leave isn't for three months, but for eighteen years, if mothers so desire.

To turn the clock back, we need to repeal the entire panoply of mandates that is turning the workplace into an adjunct of the welfare office, not extend them, as the mistitled Family Leave Act has.