Biden Administration Proposes Paid Family and Medical Leave

The Biden Administration included paid family and medical leave in the recently released American Families Plan. The proposal, which would be phased-in, guarantees 12 weeks of paid parental, family, and personal illness leave by the program’s tenth year. It also promises workers three days of paid bereavement leave annually. The program would provide workers with up to $4,000 per month, with an average of two-thirds of average weekly wages replaced. The Administration estimates that the program would cost $225 billion over a decade. 

Ever since the passage of the Family and Medical Leave Act (FMLA), which provides up to 12 weeks of unpaid family and medical leave, there have been proposals to make FMLA leave paid.

Since 2013, the Family and Medical Leave Insurance Act (H.R. 804, S. 248) has been introduced and has always had many cosponsors. The bill would establish a Family and Medical Leave Insurance Trust Fund that would provide up to 12 weeks of paid family and medical leave due to the serious health condition of the individual or a relative, including a domestic partner. The initial maximum monthly payment would be $4,000, and this amount would be indexed to the national average wage index in subsequent years. The newly established trust fund would be financed through a payroll tax of 0.2% of wages paid by both employees and employers.

The Families First Coronavirus Relief Act (FFRA) established a temporary emergency paid family and medical leave, which expired on Dec. 31, 2020. However, due to the passage of the Federal Employee Paid Leave Act, since Oct. 1, 2020, federal employees have been provided with up to 12 weeks of paid parental leave due to the birth or placement of a child for either adoption or foster care.   

Labor Department Withdraws Independent Contractor Regulations

During the Trump Administration, the Department of Labor had issued final regulations making it easier for employers to classify workers as independent contractors. The rules were due to take effect on March 8, 2021, but with the change in administrations, the Department of Labor announced on March 4, 2021, that it was delaying the effective date until May 7, 2021. As a result, on May 6th, the Department of Labor withdrew the regulations. The reasons the Labor Department cited for the withdrawal included:

  • “The independent contractor rule was in tension with the FLSA’s text and purpose as well as relevant judicial precedent. 

  • “The rule’s prioritization of two “core factors” for determining employee status under the FLSA would have undermined the longstanding balancing approach of the economic realities test and court decisions requiring a review of the totality of the circumstances related to the employment relationship.

  • “The rule would have narrowed the facts and considerations comprising the analysis of whether a worker is an employee or an independent contractor, resulting in workers losing FLSA protections.”

The Coalition for Workforce Innovation filed a lawsuit in the United States District Court for the Eastern District of Texas, claiming the Biden Administration, in delaying and withdrawing these regulations, violated the Administrative Procedure Act. In addition to withdrawing the regulations, the Department of Labor also rescinded several Wage Hour Opinion Letters that used the proposed regulations as the basis for determining independent contractor status. 

Minimum Wage Increases for Federal Contractors

President Biden signed an executive order to increase the minimum wage for federal contractors to $15 per hour. The increased minimum wage will be effective on January 30, 2022. Starting January 1, 2023, and every subsequent year, the minimum wage will be increased by the amount the Consumer Price Index for Urban Wage Earners and Clerical Workers goes up. For federal contractors who receive tips, the cash wage they must be paid will be $10.50 per hour effective Jan. 30, 2022, and on Jan. 1, 2023, it will be 85% of the minimum wage for federal contractors. Starting Jan. 1, 2024, the minimum wage for tipped employees will be the same as that of federal contractors. The Secretary of Labor is directed to issue regulations implementing this executive order by Nov. 24, 2021. The executive order is available to read on the White House's official website.

The Biden Administration supports legislation (H.R. 603, S. 53) to raise the minimum wage over several years until it reaches $15 per hour in 2025. This proposal was included in the American Rescue Plan that passed the House of Representatives, but was removed during Senate consideration of the legislation.  

DOL Issues COBRA Continuation of Coverage Model Notice

The Department of Labor has issued model notices for the continuation of COBRA coverage under the American Rescue Plan Act. The Labor Department advised that using a model election notice will constitute good faith compliance with the election notice content requirements in both COBRA and the American Rescue Plan Act.

The American Rescue Plan Act includes a 100% COBRA subsidy for up to six months, starting on April 1, 2021, and ending on Sept. 30, 2021. The employer is responsible for paying the COBRA premiums for assistance eligible individuals. Such premiums will be recoverable by the employer through payroll tax credits when filing quarterly FICA tax returns. To qualify, individuals must be eligible for COBRA continuation coverage due to an involuntary termination of employment or reduced hours and choose COBRA continuation coverage. The COBRA subsidy is also available for those who lost coverage before April 1, 2021, and who are either on COBRA as of April 1 or who did not choose COBRA. This provision does not extend COBRA coverage beyond the 18 months provided for in the law. 

EEOC Hosts an All-Virtual Commission Hearing

The U.S. Equal Employment Opportunity Commission (EEOC) held its first all-virtual Commission hearing on Wednesday, April 28. 

The hearing considered the impact of the COVID-19 pandemic on workers, the difficulties employers face in navigating potential employment discrimination issues raised by COVID-19, and future challenges the pandemic may present for employees and employers. EEOC Chair Charlotte A. Burrows stated: “Today’s testimony makes clear that, while the pandemic continues to have serious impacts on public health and our economy, it has also created a civil rights crisis for many of America’s workers.” Additional information on the hearing is available on the EEOC's website.

Neil Reichenberg is the former executive director of the International Public Management Association for Human Resources. He is an attorney, a frequent writer and speaker on public policy and human resource issues, and an adjunct faculty member at George Mason University. For questions or additional information, contact Reichenberg at