The Massachusetts Paid Family and Medical Leave Act applies to all employers who have at least one employee in Massachusetts. On June 14, 2019, the original notification and contribution dates were delayed by several months. The current deadline for making required notifications to employees is now September 30, 2019. Starting October 1, 2019, employers must take the required deductions from employee payroll, make any required employer contributions, and remit contributions to the Family and Employment Security Trust Fund (the “Trust Fund”). Because of the delay in the start date for deductions and contributions, the contribution rate has also been adjusted. Paid family and medical leave benefits will be available beginning in 2021.
Massachusetts employers must provide an appropriate notification of the new law to members of their workforce by the extended deadline of September 30, 2019. The notification requirements include both providing a written notice directly to employees and displaying a workplace poster in a conspicuous place. The Department of Family and Medical Leave has made available template notices on its website.
An employer who provided written notices to employees prior to June 14, 2019 (the date the delay was announced), will need to provide employees with a rate update sheet explaining the updated deadlines and contribution rates. The Department of Family and Medical Leave has made available template rate update sheets on its website. While rate update sheets are not required to be signed by employees, an employer must keep a record of its having distributed the required notice to all covered workers.
Payroll Deductions and Employer Contributions
Employers must begin taking payroll deductions (and deductions from payments for services to independent contractors, if independent contractors comprise 50% or more of the employer’s workforce) starting October 1, 2019. The total contribution amount that must be remitted to the Trust Fund is 0.75% of earnings (with such earnings capped at the maximum earnings taxed for Social Security purposes). For employers who have 25 or more covered individuals, the employer must pay 60% of the contribution. The number of covered individuals is determined by the number of W-2 employees (and, if an employee’s workforce is made up of 50% or more independent contractors, the number of W-2 employees plus the number of independent contractors). The Department has provided an online calculator to help employers determine if they are required to make an employer’s contribution in addition to the 0.75% covered individual contribution. There is also an online calculator to help employees calculate the amount of their paid leave benefits.
Employers will be responsible for remitting contributions for the October 1, 2019 – December 31, 2019 quarter through MassTaxConnect by January 31, 2020.
Eligible Worker Benefits
Covered individuals are expected to be eligible to take leave under the Paid Family and Medical Leave Act beginning January 1, 2021. Covered individuals may be eligible for:
- Up to 12 weeks of paid family leave for the birth, adoption, or foster care placement of a child.
- Up to 12 weeks of paid family leave due to a qualifying exigency related to a family member on active duty or an impending call to active duty in the Armed Forces.
- Up to 26 weeks of paid family leave in order to care for a family member who is a covered service member.
- Up to 20 weeks of paid medical leave for a serious health condition resulting in incapacitation from work.
Beginning July 1, 2021, covered individuals are expected to be eligible for:
- Up to 12 weeks of paid family leave to care for a family member with a serious health condition.
A covered individual will have to file a claim for benefits that includes a certification that the leave is for a qualifying reason. The maximum number of weeks an individual may receive benefits in a benefit year is 26 weeks.
Private Plan Exemption
Employers that offer a private plan with benefits equal to or greater than those offered under the law may apply for an exemption from the requirements to submit payroll deductions or pay employer contributions. The plan must not be more expensive for employees (and any self-employed individuals) and the employer’s policies must provide greater or equal rights and protections as those available under the law. The application is available through MassTaxConnect, and the deadline to file for a private plan exemption for first quarter contributions is December 20, 2019.
For more information on the Massachusetts Paid Family and Medical Leave Act, please contact Diane DeGiacomo or Lucy Prashker of the firm’s Employment Law Department.