12 Apr 2024 - Carr Maloney P.C.

Maryland Adopts Family and Medical Leave Insurance Requirements

Written By Dennis Chong

Maryland has prepared to join D.C., Delaware, and New Jersey in launching the Family and Medical Leave Insurance program, which promises to provide employees in the State with paid leave under certain circumstances. The FAMLI provides wage replacement to workers who need to take qualified leave for up to 12 weeks.

Similar to the State-run unemployment insurance program, FAMLI is designed to provide Maryland employees with a cushion of funds in the event they need to take a form of protected leave. The benefit amount varies by employee (depending on their wages) but can be up to 90% of their wages, up to a maximum of $1,000 per week for up to 12 weeks. Protected leave includes leave:

• For an employee’s serious health condition
• For an employee’s family member’s serious health condition
• To welcome a child into the family
• To prepare for a family member’s military deployment

Maryland has set up a State Plan to administer a fund for this purpose. Contributions to this State Fund are currently scheduled to begin on July 1, 2025, and the goal is to begin offering benefits to employees in July or August of 2026. Employers will be automatically enrolled in this Plan but may opt to use a private plan. If the employer chooses to offer benefits that are equal to or better than the State Plan, it can submit a proposal for this self-insured plan to the Department of Labor for approval.

Employers will need to begin paying into the Fund (or their private plan) in July 2025.

• For employers with 15 or more workers, employers will pay 0.90% of covered wages up to the Social Security cap. Employers may transfer half of this contribution to the employee.
• For employers with fewer than 15 workers, employers will pay 0.45% of the employee’s wages. Employers may transfer all of this contribution to the employee (e.g., through payroll withholding).
  Employers must contribute to this Plan (or their self-insured plan) based on its total number of workers, including workers who do not qualify to actually receive the benefits.

In anticipation of this change, Maryland employers should begin to include FAMLI contributions as part of their budgeting process starting in 2025.