The American Supply Association is one of 83 organizations representing hundreds of thousands of businesses that employ millions of individuals that have asked Congress to consider improvements to H.R. 6201, the Families First Coronavirus Response Act.
The suggested improvements, ASA noted in signing the letter addressed to U.S. Senate Majority Leader Mitch McConnell and U.S. Senate Democratic Leader Charles Schumer, will ensure all American workers have access to paid leave in the face of the current public health crisis while also providing relief to businesses and important incentives to sustain access to employer-provided health benefits, on which nearly 180 million Americans depend.
The letter urges Congress to replace the paid leave mandates with a federal emergency program. The leave mandates in H.R. 6201, which requires businesses with 500 and fewer employees to provide 12 weeks of paid leave, presume liquidity and a tolerance for debt that simply does not exist at this time.
ASA and its coalition members fear these mandates will accelerate small and medium business closures, causing many Americans to lose employer-provided health benefits while straining the administrative and financial resources of state unemployment agencies. Although H.R. 6201 includes tax credits and Treasury Secretary Mnuchin has promised to advance business money, credits will not produce sufficient liquidity in time, the letter points out, noting the fear is the U.S. government does not have the infrastructure, and businesses do not have the administrative resources to access these advances in the time needed to deter business closures.
A better approach, ASA and its coalition members explains, would be a public program administered by the federal government to provide compensation for COVID-19-related leave. One example is the proposed program in H.R. 6198, under which the Social Security Administration (SSA) would provide financial assistance to American workers impacted by COVID-19. SSA is often one of the first agencies on the ground in natural disasters, and it has extensive experience and procedures in place for responding in emergency situations.
The legislation includes multiple protections to ensure that Social Security funds are not diverted to the new emergency leave program. Other agencies, such as the U.S. Department of Labor, could also administer a program using unemployment insurance to provide compensation for leave, and we encourage Congress to also consider that agency and unemployment insurance as an option for relief.
While ASA and its coalition partners understand such programs would impose significant costs on the government, this investment now will prevent far greater costs in the future, including increased unemployment and Medicaid costs as well as hardship for American workers and businesses alike. Additionally, ASA and its coalition partners believe a federally administered program is needed to provide critical income to workers and liquidity to businesses which will help our economy weather this storm by encouraging businesses to keep employees “on the books.” This will help ensure continuation of employer provided benefits, especially healthcare benefits.
