New York Paid Family Leave Law: Details, Details and More Details
By Christopher Caldari | Employee Benefits Consultant and Dan Kuperstein | Senior Vice President, Compliance
8.29.2017 - Corporate Synergies
The
law requires employers to allow workers to take paid leave for certain family
situationscand protects the employeefs job.
Employers in New York need to begin preparing now for big changes coming
January 1, 2018, when the New York Paid Family Leave (NYPFL) benefit goes into
effect. The NYPFL law is
being called one of the most comprehensive paid family leave programs in the
nation. The law requires employers to allow employees to take paid job-protected
leave for events such as tending to a family member with a serious health
condition, bonding with a new child or addressing the needs of a family member
who has been called to active military service. During any period of NYPFL,
employers must maintain the employeefs existing health benefits for the duration
of the leave period as if the employee had continued to work.
During leave, employees receive 50% of the state average weekly wage for up
to eight weeks in 2018; this will increase incrementally to 12 weeks and 67% of
the state average weekly wage by 2021. Currently, the average weekly wage is
$1,305.92, which means the maximum weekly pay that employees can receive while
on leave is $652.96 for 2018.
What kinds of eligibility and notice requirements are in the NYPFL law?
An employee is eligible for this new paid family leave if they work a regular
schedule of 20 or more hours per week and theyfve worked for their current
employer at least 26 weeks before the first full day of leave. Employees who
work fewer than 20 hours each are eligible after 175 workdays.
Prior to starting leave, employees
have to give the employer at least 30 daysf advance notice.
Also, employees may have to submit a special PFL-1 Form to their employerfs
insurance carrier or to their employer if the plan is self-insured. Depending on
the reason for leave, the employee may also have to provide medical
certification of the family memberfs condition or have a family member submit to
a medical exam.
In most cases, as permitted by the law, employers will be requiring employees
to contribute the entire premium for the benefit. The employer also may
choose to fund it themselves, and in certain unionized workplaces, the CBA
contract may require full contribution by the employer. The opportunity to fund
the program (whether through employee deductions or self-funding) actually began
July 1, 2017, a full six months before the start of the benefit; however, this
opportunity is voluntary – contributions to the program are not required until
January 1, 2018.
Contributions toward the cost of NYPFL insurance are calculated on a weekly
basis. The amount of the contribution is set at 0.126% of an employeefs average
weekly wage or the statewide average weekly wage, whichever is less. The maximum
contribution is $1.65 per employee per week, or $85.56 per employee per
year.
Whatfs the difference between paid family leave and disability leave?
The NYPFL and the New York State Disability Benefit are different benefits
that can work together, but the monetary benefits cannot be paid to the employee
at the same time. Specifically, an employee can combine both lawsf leave periods
for a total of 26 weeks of leave in a 52-week period—eight weeks of NYPFL and 18
weeks of disability—if they qualify for both.
However, there are some details to watch for: under NYPFL law, paid leave
canft be used for an employeefs own disability. Additionally, employees canft
receive paid leave benefits (i.e., monetary benefits) and disability
benefits at the same time. The NYPFL regulations do, however, clarify that an
employee may receive disability benefits or NYPFL benefits during the same
post-partum period, but not concurrently.
Whatfs the difference between paid family leave and paid time off?
Unlike with the Family and Medical Leave Act (FMLA), an employer canft
require an employee to first use accrued paid time off (PTO) before NYPFL goes
into effect, though they can give the employee the option to use PTO in lieu of
the NYPFL benefit.
However, if an employee plans to use NYPFL and Family and Medical Leave Act
(FMLA) leave at the same time, if the employer is subject to federal FMLA rules
(for 50+ employees), and if the employee is eligible for leave under both laws,
then the employerfs FMLA policy dictates how PTO is used. This is an interesting
twist: in other words, if an employee is eligible for both FMLA and NYPFL, then
the employer can mandate the use of accrued, unused PTO first.
Paid family leave is not FMLA
The most important difference between New York Paid Family Leave and FMLA is
that NYPFL pays 50% of an employeefs average wages and FMLA does not. In
addition, each program has different requirements. FMLA applies to employers
with 50 or more employees within a 75-mile radius of the worksite at which the
employee is employed, while NYPFL applies to any New York company with one or
more employees, and applies only to those employees actually working in the
state. An employee must work at least 1,250 hours in the 12 months before FMLA
leave; NYPFL requires an employee to work 26 weeks before taking leave.
What employers should do to prepare
The new state paid leave law goes into effect January 1, which gives your
organization a few months to prepare. First, review your current leave policies
in your employee handbook, collective bargaining agreement, plan document and
summary plan description, and determine how the NYPFL policy will work with
these policies. It may work alongside these policies, or the company may need to
make changes to them, but these existing policies should be reviewed.
Further, regardless of how your existing policies may change, the NYPFL law
requires employers to maintain a new employment policy (whether within, or
outside of, the existing employment policies) that explains all of an employeefs
rights and obligations under the NYPFL, including information on how to file a
claim for paid family leave.
Next, determine when your organization will pay for the NYPFL contributions.
If youfd like employees to contribute early, that is, before January 1, 2018,
then introduce the program to them and begin deductions. Finally, regardless of
when contributions start, communicate with your employees so that they know that
the deduction will be taken, how much will be deducted from their pay, and
ensure that they understand how the benefits will work when they go into effect
in 2018.