By Eric Durr, Halleland Lewis Nilan & Johnson

Senator Chris Dodd (D-CT), author of the original Family Medical Leave Act (FMLA) and current presidential candidate, announced on February 1 that he will introduce legislation in the coming weeks proposing an expansion of the FMLA, currently an unpaid leave, to provide for at least six weeks of paid leave for employees. The bill, which will be co-sponsored by Senator Ted Stevens (R-AK), would also expand the number of individuals eligible for FMLA leave. So while at present, FMLA leave incurs no direct cost for employers beyond the expense associated with a loss in productivity and the cost of monitoring leave, that picture would significantly change under Dodd's paradigm.

The announcement of the proposed legislation coincided with the release of the Work, Family and Equity Index, by Harvard and McGill University researchers. The Index indicates the United States is far behind other countries when it comes to family-oriented workplace policies such as maternity leave and paid sick days. According to Dodd, "[t]his report validates what millions of working Americans already know ­ that the U.S. does not do nearly enough to ensure that our workers aren't forced to choose between their family and their job. Now more than ever, millions of workers need to be able to take care of their young children and their aging parents. No worker should be penalized for caring for their family."

Given that Senator Dodd has not officially proposed the legislation, it is unclear how such a system would actually work and what percentage of the funding would come from employers. All that is known is that Senator Dodd proposes to fund the program through a shared-cost mechanism, involving the employer, the employee and the federal government. However, it seems fair to surmise that such a change would have a significant impact on employers and employees.

For starters, the proposed legislation may not give employees the full intended benefit. At present, an employee is only entitled to FMLA leave if he or she suffers from a "serious health condition," a term defined as illness, injury, impairment or physical or mental condition that involves (1) inpatient care in a hospital, hospice, or residential medical care facility; or (2) continuing treatment by a health care provider. In today's environment, employers typically grant FMLA leave even if the employee's condition does not rise to the level of a serious health condition because there is no direct expense incurred when they grant leave. For most companies, the costs associated with tracking the eligibility of leave outweigh the benefits of taking unacceptable leave to task.

However, by converting all unpaid leave into paid leave, employers will have a financial motive to more vigilantly assess, and where appropriate, challenge an employee's contention that he or she is suffering from a serious health condition. This may likely mean the purchasing and constant administration of helpful, yet pricey leave-tracking programs that sort out and add up the various kinds and amounts of qualified or non-qualified leave. It would also include requiring employees to get a second medical opinion from a physician of the employer's choice, and where necessary, denying leave to the employee. The end result is that it could become far more difficult for an employee to gain medical leave.

From the employer's perspective, the adoption of the proposed legislation will surely result in significant additional costs. Initially, there is the new direct cost of being obligated to pay their employees for FMLA leave. But even if an employer wishes to challenge an employee's entitlement to leave, then they will be forced to pay for the second medical opinion. Finally, because an employer can require an employee to take any available vacation time or sick leave when on FMLA leave, paid FMLA leave will cause employers to replace their existing vacation and sick leave system with a combined PTO system. All of these factors will combine to cost employers millions, if not billions, of dollars each year.

Senator Dodd's proposal reopens the interesting and important discussion of what our workforce needs to remain productive and keep our economy successful and competitive. Employers and employees alike should continue following this development, as the proposed legislation will no doubt mean a fundamental reshaping of the FMLA and a major shift in employer-employee relationships.

Eric Durr is a labor and employment attorney with the law firm of Halleland Lewis Nilan & Johnson, PA. He can be reached at 612.573.2965 or edurr@halleland.com.