Editorial: Family business

In its first year, New Jersey's family-leave program has proved its critics wrong. It has cost the state less than expected, while showing a little compassion to workers when a relative needs care.

New Jersey became only the third state to allow paid time off to take care of a sick relative or a newborn or newly adopted child when the Legislature adopted the plan in 2008.

Business interests strongly opposed family leave, making unconvincing arguments that it would place an unfair burden on employers, especially small businesses.

But recent statistics from the state Department of Labor show that the Family Leave Insurance program has been widely successful and cost-effective since taking effect in 2009.

It has not been a drain on the state's budget, nor on businesses, because employees fund it through mandatory payroll deductions. Businesses must guarantee a job for those who take leave.

Between April 2009 and May 2010, New Jersey collected $131.4 million in payroll deductions for family leave. But it paid out only $60 million in benefits.

Fewer people than expected took advantage of the program - about 26,000 - which also helped to minimize the potential hardship on businesses. The majority taking leave were women ages 25 to 44, and most were employed in the private sector.

Most of the claims for leave, about 80 percent, allowed parents to bond with newborns or newly adopted children. The average leave lasted 4.6 weeks, less than the 5.5 weeks expected.

The plan seemed to work as designed, with 85 percent of those who applied for leave getting approved. Those who were denied typically lacked a close-enough relationship with the family member, such as being a step-relative.

A sagging economy and surging unemployment rate may have been factors in the lower-than-expected participation. A worker can take off up to six weeks and get paid two-thirds of her or his salary, up to $561.

New Jersey's decision to give workers a financial safety net to take care of loved ones was the right thing to do. It will pay off in ways that cannot always be measured in dollars and cents.