More and more states are adding paid family and medical leave (PFML) laws to help workers ensure some of their wages continue even during a serious illness — of their own or for a family member — or the birth of a child. If you have employees in California, New York, New Jersey, or Rhode Island, you were one of the first employers to have PFML responsibilities. And now Connecticut, Washington, and Washington D.C. have added requirements.
If your state is considering one of these laws, you may be curious about what it means for your payroll tax collection or how the benefits will work for your employees. We’ve pulled together a state-by-state guide for paid family leave requirements and how they impact your business.
Yes, the Family and Medical Leave Act (FMLA) requires employers to guarantee employees time off for family or medical reasons and offer them a job with comparable pay and benefits — though not necessarily the same job — when they return. When it became law in 1993, FMLA was intended to offer some stability for employees who needed to take time away from work to deal with a major medical issue of their own or care for a seriously ill family member.
Up until then, there was no federal protection like this for workers, including women and men who took time off after the birth or adoption of a child. Whether or not an employee would have a job when they got back depended on the state they lived in or their company’s employment policies.
However, while the FMLA guarantees up to 12 weeks’ leave, that time is unpaid. Companies with fewer than 50 employees are also exempt from the federal law. So, many states have opted to require employers to provide a paid option to go a step further to offer some income while an employee is out on leave. Most of this funding is paid through taxes collected from the employee, employer, or both — but typically collected and remitted to the state by the employer.
By the start of 2021, nine states will have government-sponsored family-leave insurance programs in effect:
Some cities also require paid family leave, so it’s worth doing a little digging to see if your city is working on one of these laws as well.
Here’s how the leave laws break down by state:
|State or district||How it works||The fine print||Effective date|
|California||Employees get time off to care for a new, adopted or foster child or specific family relations.
Employees can receive 60-70 percent of wages for up to six weeks within any 12-month period.
The length of employment does not affect eligibility.
|Employees must be a part- or full-time public- or private-sector employee who has contributed to the State Disability Insurance program through mandatory payroll deductions at some point during the previous 18 months.
Note: California’s program does not provide job protection — only monetary benefits.
|Connecticut||Employees get up to 16 weeks of unpaid leave in any two-year period in the event of the birth or adoption of a child, serious illness of the employee, or serious illness of a close family member.||Employers with fewer than 75 employees are exempt.
Employees must have been employed for 12 months and have worked at least 1,000 or more hours in the 12-month period preceding the first day of leave.
|Payroll withholding begins: 1/1/2021
Employee benefits begin: 1/1/2022
|District of Columbia||Employees receive:
|The tax is 100% employer-funded and may not be deducted from a worker’s paycheck.||In effect|
|Maine||Employers will provide one hour of paid leave for every 40 hours worked up to a max of 40 hours of paid leave per year.
Employees start accruing leave on their first day of work, but cannot use it until after 120 days of employment.
Employees may use leave for any reason.
|Employees cannot use the time until they have worked at least 120 days over a one-year period.
Before full-time workers can take paid leave, they would also need to work 40 hours per week for 24 weeks. At that time, they should have earned three days’ leave.
Companies that operate seasonally or those with fewer than 10 employees are exempt.
|Massachusetts||Leave can be used to manage a serious personal illness, care for a sick family member, birth or adoption of a child, or manage family affairs while a family member is on active military duty.
Coverage is available to all W-2 workers who work in Massachusetts, whether full-time, part-time, or seasonal, as well as some 1099-NEC contractors.
|Applies to all Massachusetts employers regardless of size.
Those caring for a loved one who serves in the military may be covered for up to 26 weeks starting Jan. 1, 2021.
|Payroll withholding and employer contribution: in effect
Employee benefits begin: 1/1/2021
|New Jersey||Employees can take up to 12 weeks of leave in a 24-month period to care for a child or a family member who has a serious health condition.||Employees must have been with the employer for one year and worked at least 1000 hours in the last 12 months.
This leave cannot be used for the employee’s own personal illness.
Employees must give at least 15 days notice for intermittent leave and 30 days notice for consecutive leave.
|New York||Employees can take up to 10 weeks of leave to care for a family member with a serious health condition.
Most employees who work in New York State for private employers are eligible to take Paid Family Leave.
|Full-time and part-time employees are eligible, but both have minimum hours and length of employment requirements.||In effect|
|Oregon||Employees are entitled to a maximum of 12 weeks of family leave within a 12-month period.
Covers parental leave for the birth or adoption of a child, managing a serious health condition for the employee or a family member, pregnancy, sick child leave, bereavement, or military family leave.
|Employees may be required to give 30-days’ notice in advance of leave unless it is taken for an emergency.
Employers with fewer than 25 employees are exempt.
|Rhode Island||Employees can take up to 13 weeks in any two calendar years for the birth or adoption of a child, the employee’s own serious illness, or to care for a family member with a serious illness.||Employers with fewer than 50 employees are exempt.||In effect|
|Washington||Employees will receive up to 12 weeks to care for a new child or a family member with a serious health condition, recover from a serious illness or injury, or manage military deployment-related situation.
Employees must have worked at least 820 hours for any Washington employer during the previous 12 months.
|Employees must give 30 days notice of commencement date for the leave, except in case of an emergency.
Worker’s receive between $100 and $1000 per week depending on their income.
Most states have done a good job communicating requirements for employers including how and when they will need to begin collecting paid leave funds for covered individuals. However, if you’re feeling a little overwhelmed by it all, reach out to your accountant or payroll service provider to see how they can help make sure you’re getting paid leave deductions right.