by Marti Cardi, Esq. - Senior Compliance Consultant and Legal Counsel
November 30, 2020
Massachusetts PFML isn’t the only law bringing new consequences with the new year. Some parts of Connecticut PFML are also going into effect on January 1, 2021, and if you have even one Connecticut employee, you have things to do. We’ll provide you with a starter list here, but please register to join our CT PFML webinar on Thursday, December 3 at 2:00 Eastern.
If you don’t have Connecticut employees, it still pays to tune in to learn what various states are doing – it may be on your company’s horizon soon!
For Connecticut employers, here’s what you need to do now:
Register your business with the Connecticut Paid Family and Medical Leave Insurance Authority (the Authority)
The Authority is charged with developing and administering the CT PFML program. All employers with one or more Connecticut employee must register by December 31, 2020, to ensure receipt of important information from the Authority as issued.
Determine who in your organization will be responsible for completing the registration process and setting up your employer account on the Authority’s website. That individual will need to supply the following information during registration:
- Federal Employer Identification Number (FEIN)
- Number of Connecticut employees
- Total annual payroll for Connecticut employees
- Payroll frequency
- Intention to apply for an exemption (private plan)
- How your business will remit payments on behalf of employees
- Consider whether you want a private plan. Although you can file for approval of a CT PFML private plan at any time, there is a financial incentive to act soon. Employers with plans provisionally approved by March 31, 2021, will not have to pay the employee PFML contribution of 0.5% to the Authority for Q1 2021 but can either waive that cost for employees or use the employee contributions to fund the private plan. The process for approval of a private plan requires an affirmative vote by the majority of your Connecticut employees and other steps that will take time, so it’s best to get started right away. NOTE: The provisional private plan approval date to avoid paying employee contributions to the Authority for Q1 2021 was originally March 1, 2021, but has been changed in Authority communications to March 31, 2021.
- Get ready to withhold employee payroll deductions. Some employers elect to cover the costs of a state PFML program themselves. However, in Connecticut, if the employer is using the state plan the employer cannot cover the employees' contributions and must withhold the 0.5% contribution from employee paychecks. Employers with private plans may elect to cover the employee costs but you may not know if you have a provisionally approved private plan until after January 1, 2021. So, consider planning to withhold from employee paychecks starting January 1 and either refund the employee contributions if your plan is approved, or use those contributions to date toward plan costs and cease withholdings going forward. If you know your company is going to have the employees pay their statutory share, get ready to start withholding employee payroll contributions as of January 1, 2021.
MATRIX CAN HELP!
We are experts on all state PFML programs. If you need help in any state contact your Matrix or Reliance Standard account manager. And if you can’t make it to the CT PFML webinar on December 3, watch this space for timely updates and contact your Matrix or Reliance Standard account manager or ping us at [email protected] to receive the webinar recording when ready.