by Marti Cardi, Esq. - Senior Compliance Consultant and Legal Counsel
February 14, 2019
In our last blog post about Massachusetts Paid Family and Medical Leave (MA PFML), we boldly announced we would be holding Session 2 of our webinars on the law soon, targeting late February. Well, it turns out that the draft regulations issued on January 23 by the Massachusetts Department of Family and Medical Leave (DFML) are very preliminary and the end of February is much too soon. We have very little concrete information at this point so discussing the regulations would be quite speculative. At the end of this post is a summary of the key provisions of the Massachusetts law itself. In between, let’s share what we do know.
Status of the regulations: The DFML is holding listening sessions on the draft regs around the state through February, during which they take questions and comments about the draft but do not answer any questions. I attended the first listening session in Boston and came away with more questions than I started with! However, I have the good fortune of meeting telephonically periodically with the state Deputy Attorney General who is leading the effort to draft the regulations, so I have been able to share all of my questions, suggestions, and concerns. The DFML anticipates final regulations by the end of April, with an interim 2nd draft sometime between now and then.
Employee and employer contribution rates: One point that seems to be fairly settled is the contribution rates for PFML premiums, which start July 1, 2019.
Here’s a rundown of what we know:
- Total premium for both family and medical leave is 0.63% of employee’s wages up to the Social Security taxable amount ($132,900 in 2019)
- Of that, 0.52% is for medical leave and 0.11% is for family leave
- The employee pays all of the premium for family leave
- The premium for medical leave is paid 40% by employee, 60% by employer
- The net result is that the employer and employee each pay approximately 50% of the total premium
- Employers can opt to pay for the employee’s share of premiums for the public plan or, in the case of a private plan, not collect premiums
That 0.52%/0.11% split between medical and family leave premiums is contained in the draft regulations so it’s still subject to possible revisions, but the DFML seems pretty set on those numbers.
Private plans: Sometimes called voluntary plans in other states, the Massachusetts statute does allow employers to opt out of the state “public” plan and instead comply with the law via a private plan administered by the employer, TPA or insurance carrier. Here is what we know so far:
A private plan must confer all of the same rights, protections and benefits provided to employees under the PFML law, including but not limited to:
- Providing family leave to a covered individual for the reasons and for the number of weeks required by the law
- Allowing family or medical leave to be taken intermittently or on a reduced schedule
- Providing a wage replacement rate during all family and medical leave of at least the amount required by the law
- Imposing no additional conditions on the use of family or medical leave beyond those explicitly authorized by the law or regulations
- Using the same employee eligibility requirements as set by the law, and
- Providing that the cost to employees covered by a private plan shall not be greater than the cost charged under the state program.
An employer can choose to provide greater employee rights and benefits than those set by the law – e.g., a higher benefit rate or more weeks of paid leave.
Matrix is on it: Watch this blog for updated information and dates for the next MA PFML webinar as things develop with state procedures and the regulations. As we did in Washington, Matrix will prepare a Massachusetts private plan template for use by our clients who engage Matrix as their Massachusetts PFML TPA. One advantage to working with the state on developing the regulations is that Matrix has been able to suggest regulations that will make having a private plan easier for employers and more beneficial to both employers and employees.
Summary of the PFML law
Here are the basic elements of the MA PFML, subject to elaboration and further development through the regulations:
- Premium contributions: 07-01-2019.
- Benefits: Family member SHC: 07-01-2021.
- All other reasons: 01-01-2021.
- By state; private plans permitted; insurance permitted.
- Employee has been paid wages in the 4 quarters prior to leave amounting to at least 30 times the weekly benefit rate.
- Includes former employees if eligibility is met at end of employment and leave commences within 26 weeks
- All; no minimum number of employees
- Same or equivalent position
- Employee’s SHC
- Family member’s SHC
- Bonding/parental leave
- Military exigencies (same as FMLA)
- Care for ill or injured servicemember
FMLA and MA PFML
Additional MA PFML Family Members
- Domestic partner
- Parent-in-law (including parent of domestic partner)
Duration (12 months):
- Employee’s SHC (medical leave): 20 weeks
- Family leave (bonding, care for family member, or military exigency): 12 weeks
- Care for service member: 26 weeks
Maximum in 12-month period:
- 26 weeks
Leave Calculation Method:
- “Benefit Year” — measured forward 52 weeks from the Sunday preceding the first day of the EE’s covered leave
Leave Use Increments:
- No minimum increment
- Continuous, intermittent, reduced
- Family leave premium fully paid by EE
- Medical leave paid 40% by EE, 60% by ER
- Total premium = 0.63% of EE’s wages
- Cap on wages subject to premium determined by Social Security program limit ($132,900 for 2019)
- Split between family and medical leave premiums:
- 52% for medical and 0.11% for family = 0.63%
- Comes out to about 50/50 split in total between employer/employee
- 80% on portion of employee’s Average Weekly Wages (AWW) equal to or less than 50% of state AWW, plus
- 50% on portion of employee’s AWW greater than 50% of state AWW
- State AWW is currently $1107.48 (Dec 2019)
- Maximum based on 64% of state AWW
- Statutory cap of $850/week if 64% of AWW is higher
- Permitted for medical leave and/or family leave
- Must be approved by state
- Insurance permitted (but no details in law)
Effect on other laws:
- Concurrent with FMLA
- There is no existing MA family/medical leave law
- MA Parental Leave still in effect – 8 weeks for bonding
- Released 01-23-2019 – lots of work to be done yet!