How will the Workflex Act affect my business if it’s passed into law?

November 15, 2018

Paid time off continues to be the most valued employee benefit companies can offer new hires. And with the proposal of the Workflex in the 21st Century Act, it has shifted to the forefront of discussion topics for Congress. The bill was introduced by U.S. Rep Mimi Walters (R.Cali) in November 2017 as an innovative way for employers to offer flexible workplace arrangements for their employees while moving away from stringent state and local laws. As most HR experts will tell you, time away from work is a healthy way to reset and avoid burnout that can lead to high turnover rates. This bill aims to provide employers with a structured way to offer that.

While many companies already offer benefits packages that include extensive PTO, this bill will provide a structured model for employers who don’t already provide that. Like most legislation, this bill has fine print that every employer should read and understand. Read on to learn more about what this bill could mean for your business.

Workflex in the workplace.

Currently, there is a patchwork of 10 states plus Washington D.C. and 30 local jurisdictions that have endorsed and implemented paid sick-leave laws. This bill aims to bypass those with one federal program that employers can opt-in to but are not required.

Keys:

  • The Workflex in the 21st Century Act provides a minimum amount of required paid leave for all employees who have worked over a plan year (365 days) or over 1,000 hours at their organization. Time off would be dependent upon an employee’s tenure in addition to the size of the organization. (See chart below for more details)
  • In regards to sick or family related days, the bill does not dictate how employees use their time off.
  • If passed, this bill will be completely optional for employers. If companies wish to forego this legislation, they would be required to follow any state and local laws regarding paid leave.
  • Employee participation in any of the workflex arrangement options must be voluntary, and cannot be made mandatory by any employer.

The chart below explains paid leave requirements as outlined in the proposed legislation:

 

While it’s easy to assume that more paid leave equals more money out of the employers pocket, that is not always the case. In fact, research has shown that the cost of offering PTO is less expensive than the rehiring and on-boarding of a new employee. In addition to mandated PTO, companies opting-in to the program would also have the option of offering employees a flexible work arrangement such as a compressed work schedule or a job-sharing program. These voluntary workflex options present ways for employers to provide a better quality of life in the workplace. The following options are offered by this legislation:

  • A biweekly work program that would consist of a basic work requirement of no more than 80 hours over one 2-week period. In which more than 40 hours but not more than 60 hours of the work requirement may occur in a week of the two-week period.
  • A compressed work schedule program that allows the employee to work the equivalent of full-time employment by increasing the number of daily hours worked, such as a four-day workweek.
  • A telework program that allows the employee to work from a location other than the location from which the employee would normally work.
  • A job-sharing program that allows two or more employees to share one employment position.
  • Flexible scheduling under which an employee’s regular work schedule is altered.
  • Predictable scheduling under which an employer provides a work schedule to an employee.

While many of these workflex options are currently used to boost recruitment and retention, it’s important to note that this bill would not prevent employers from providing benefits beyond those listed above.

This legislation would remove the confusion of state and local laws and make it easier for employers to navigate paid time off for their employees. Offering PTO in addition to other benefits such as any of the workflex options can help all employers, including those who own small businesses (less than 50 employees), retain workers and build rapport with potential new hires. If you are unsure about which benefits would help your workforce in particular, we’re here to help with that.

While you’re waiting on Congress…

Employee benefits such as paid time off and flexible work hours can help your business become a destination for top talent. The best part is, you don’t need federal legislation to pass in order to make a change. Our team of HR professionals can dive into your company’s needs and develop a customized strategy to help your organization attract the best and keep them around.

Stay up to date on the status of this bill here.

At SourcePointe, we utilize our industry-experience to provide you with a multitude of customizable HR services, support, and solutions. All so your business can do one thing – more business. We’ll provide tailor-made solutions that fit your company’s needs while providing a solid return on your investment that pays off immediately – and for many years after that.

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