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Sweeney Bill Reducing Paid Family Leave Contributions Approved By Senate

TRENTON – A bill to reduce the amount of money employees pay into the state fund to pay for paid family leaves of absence, sponsored by Senate Majority Leader Stephen Sweeney, was approved 23-13 today by the full Senate.

The bill (S3065) would require the state Commissioner of Labor and Workforce Development, beginning in 2011, to make annual adjustments in rate of contribution to be paid by workers into the “Family Temporary Disability Leave Account.”

“The fund is currently running a substantial surplus,”said Sen. Sweeney (D-Gloucester, Cumberland and Salem). “The amount of money that we take from employees’ paychecks should be adjusted to reflect that. We can make sure we have adequate resources available to keep the program running while we reduce the amount of money we collect from workers.”

Sen. Sweeney’s bill would require the commissioner to make a determination by July 31 of the preceding year. The rate would be determined by calculating 125 percent of the benefits estimated to be payable for family disability leave benefits during the calendar year plus the total amount needed to administer the benefits, minus the surplus assets from the preceding year.

“In the past we’ve seen state benefits accounts accumulate large surpluses, like the state disability benefits fund, only to have those funds raided for other purposes. This bill will prevent that by making sure we collect from employees only as much as we need to make sure the paid family benefits can be paid.”

Sen. Sweeney sponsored the Paid Family Leave Act, which was signed into law by Gov. Jon S. Corzine on May 2, 2008. It permits workers to apply for up to six weeks paid leave to care for a newborn or newly adopted child, or a sick parent, spouse or child. Recipients can collect up to two-thirds of their pay, to a maximum of $524 a week. Family leave benefits are funded by an employee payroll tax.

During calendar year 2009, total contributions have substantially exceeded total benefits.

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