New York State Paid Family Leave Benefits Law

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1 New York State Paid Family Leave Benefits Law PERMA 2018 Annual Member Conference May 24, 2018 Dan Colacino - Vice President Shauna Waldin, PHR Director of Compliance & Wellness

2 New York State Paid Family Leave (PFL) Signed into law by Governor Cuomo in 2016, New York s PFL program is one of the most comprehensive in the nation, joining programs already active in CA, RI and NJ source: parentmap.com Provides paid time-off, job protection and benefit continuation 2

3 Paid Family Leave (PFL) Overview * Paid FAMILY Leave - NOT Paid Sick/Medical Leave Employees may request leave to: Bond with a newborn or newly placed adopted or foster child Leave can be taken within the first year of birth/placement; so beginning 1/1/19 this would include babies born in 2018 Care for a family member with a serious health condition This includes child, spouse, parent, parent-in-law, Step-parent, grandparent, grandchild or domestic partner No age limit on child For a qualifying exigency arising from a family member s military service Exactly as defined in the Federal Family and Medical Leave Act 3

4 Phased-in Benefits Percentage of employee s average weekly wages is calculated based on 8 weeks prior to leave OR the State Average Weekly Wage (SAWW) rate, whichever is less The SAWW for calendar year 2018 is $1, SAWW $1,

5 Calculating Benefit The 8 week calculation will exclude the final week if hours are reduced due to the leave request Periods of absence that are due to the nature of that employment, when employment is not terminated during those periods, have no negative impact on eligibility (i.e. school recess) 8 week coordination with other leaves/time away

6 Which Employees are Eligible? Employees who work 20 or more hours a week will be eligible for PFL after 26 consecutive weeks, regardless of the number of days worked per week Employees who work less than 20 hours a week will become eligible after working 175 days in a 52 week period There is no minimum hours requirement on each day 6

7 PFL Waiver (Limited Use) Employee shall be provided the option to file a PFL waiver When an employer and employee know at the date of hire that the employee s schedule will not allow them to become eligible for PFL benefits. FT schedule that is less than 26 consecutive weeks (such as summer help) PT schedule that will not work 175 days in 52 week period (a person who works a day or maybe 2 days a week) Waiver is at the employee s election and cannot be applied automatically by the employer 7

8 Revoking PFL Waiver Within eight weeks of any change in the regular work schedule of an employee that would make an employee eligible for PFL benefits, any waiver filed will be deemed revoked An employee whose waiver has been revoked shall be obligated to begin making contributions to the cost of family leave benefits, including any retroactive amounts due from date of hire, as soon as the employee is notified by the covered employer of such obligation Once eligible, always eligible 8

9 PFL Rates PFL rates for 2018 are a percentage of income rather than a fixed rate 0.126% of wages capped at the annualized SAWW which is a max of $85.56 PFL premiums are community rated The employee contribution rate is set every year to equal the cost of insurance coverage DFS Superintendent will set the maximum employee contribution rate for the upcoming year by Sept. 1 9

10 PFL & Payroll Payroll deductions will begin: For current employees, even if they haven't met eligibility but are expected to All eligible new hires, at the time of hire (no wait) Deductions are post-tax Contributions are reported on W2, box 14 Carriers are responsible for sending Form 1099 to employees for any benefits paid 10

11 PFL Administration How the Program Will Work

12 Federal FMLA/PFL Comparison Covered Employers Benefit Qualifying Coverage Length of Leave Job Restoration FMLA 50 or more employees Unpaid, job-protected leave and benefit continuation Employed for 12 months and worked 1,250 hours in the previous 12 months Employee's own serious health condition, the birth/placement of a child, to care for an immediate family member (spouse, child or parent) and military exigency Up to 12 weeks in a 12 month period Must be restored to his/her original job, or to an "equivalent job" which means virtually identical to the original job in terms of pay, benefits and other employment terms and conditions PFL All employers subject to Workers Compensation Law Paid, job-protected leave and benefit continuation Employed for 26 consecutive weeks (FT) or worked 175 days (PT) Cannot be used for employee's own serious health condition. Covers birth of a child and expands family members to also include domestic partners, parent-in-law, grandparent, grandchild. Also includes military exigency Starts at 8 weeks in 2018 and will gradually increase to 12 weeks in 2021 must be restored to position held prior to the leave or comparable position with comparable benefits, pay and terms and conditions of employment Intermittent Leave PTO Interaction Allowable for one's own, or a family members, serious health condition when medically necessary; employer-optional for bonding leave. Used in as little as 1hr increments Employer could require an employee to use accrued and unused PTO to substitute unpaid leave Allowable for the same scenarios as FMLA, plus bonding leave. Must be taken in full-day increments (1/5 the weekly benefit) Employer cannot require an employee to use accrued and unused PTO, however, the employee has the option to choose 12

13 DBL/PFL Comparison Covered Events Eligibility Eligibility Transfer Waiting Period Weekly Benefit Amount DBL Ones OWN injury or illness FT - have worked 4 consecutive weeks, or; PT - completed 25 working days for any covered employer If an employee changes jobs from one covered employer to another, their time worked at the previous employer counts No benefits paid during the first 7 days of leave 50% of employee's Average Weekly Wage (AWW) to $170 per week maximum PFL Care for a family member during illness/injury, also family bonding and military exigency FT -employed at least 26 consecutive weeks, or; PT -completed at least 175 working days with their current employer NO - eligibility resets with each new employment Benefits begin the first day of a qualified leave Phased-in over 4 years, 2018: 50% of employees AWW, capped at State AWW ($ ) Funding Maximum Employee Contributions Employer is responsible for premium, which can they can elect to cover, share, or require employee contributions.5% of covered wages but no more than $.60 per week Will be determined by NYS DFS each year by 9/ : 0.126% of employee's weekly wage, capped at NYS AWW ($ ) Maximum Leave Duration 26 weeks in a consecutive 52-week period Phased-in over 4 years, 2018: 8 weeks You cannot take DBL & PFL at the same time. Some scenarios may allow leave to be taken in sequence. DBL and PFL combined cannot exceed 26 weeks during any 52 consecutive calendar weeks 13

14 DBL, PFL and Maternity DBL and PFL cannot be taken concurrently, however maternity creates a unique scenario due to the baby bonding, in addition to ones own disability DBL 6 weeks PFL 8 weeks FMLA 12 weeks A mother will qualify for both programs, at her discretion, after the birth of a child when: 6 or 8 weeks is considered under DBL for the birth 8 weeks is available for bonding Also of note: Mother-to-be can go out on DBL prior to her due date If mother has complications (including postpartum depression) and has moved to PFL, she can go back on DBL 14

15 PFL & Paid Time Off An employer can offer their employees the option to use accrued time or charge all or part of their leave to PFL If an employer pays full salary during a period of PFL, they may request reimbursement from their carrier, similar to seeking reimbursement for workers compensation benefits Employees won t be able to collect full pay and PFL benefits simultaneously Employers will decide whether they substitute or supplement pay, if allowing this at all When an employee elects to use paid time, they will still be afforded the full protections of PFL (job/benefit protection) 15

16 PFL Coverage, DBL Carrier For NY covered employers, both DBL and PFL must be from the same insurance carrier PFL is generally added as a rider into existing DBL policies, and will appear as a separate line item on the group s DBL bill PUBLIC employers (in theory) can offer the benefits separately 16

17 Carrier Administration of PFL PFL claims will be verified via a claim form and follow a similar process to DBL Each claim will include a Request for Paid Family Leave (PFL-1) and Certification(s) (PFL-2 through PFL-5) Once the Employer receives a request for PFL from an employee, they shall complete the employer information and return to employee within 3 business days Unlike DBL, claims for PFL can still be approved without the employer s portion 17

18 Receipt of Claim by Carrier Incomplete Request Carrier will provide a list of all required, but missing, information and instructions within 5 days of receipt of the claim; claim is pending - not denied, during this period Once all missing pieces are received, carrier must pay or deny the claim within 18 days Complete Request Carrier shall provide the employee confirmation of receipt of a complete claim within three business days Carrier must pay the claim or deny the claim within 18 days from the day of receipt After initial payment, schedule is biweekly An EOB or similar reporting will be sent to the employer for approved PFL claims. Communication will vary by carrier. 18

19 Employee Request for PFL Employees are required to give employer 30 days notice, when leave is foreseeable As soon as practical in emergency situations Similar to FMLA, an employee need not expressly assert rights under PFL or even mention family leave 19

20 Additional PFL Benefits An employer may not discriminate against employees for taking PFL, meaning: Employees are guaranteed job protection upon return from PFL, defined as returning an employee to the same or a comparable job Employees are also guaranteed continuation of health insurance while out on PFL Employees who contribute to the cost of health insurance must continue to pay their portion of the premium cost 20

21 PFL & The Public Sector Public sector employees are not covered for Paid Family Leave unless an employer chooses to offer it For union-represented employees, the benefit is required to be negotiated. The insurance benefit must be at least as favorable as what is required by the law Public employers must notify the NYS Workers' Compensation Board, and all employees who will make contributions, 90 days before the first Paid Family Leave employee deduction is made 21

22 Opting-in to PFL Complete the opt-in application available at ny.gov/paidfamilyleave; Form varies depending on the setup of coverage Completed applications should be submitted by to the Plans Acceptance Unit of the Workers Compensation Board at Outside of the timing required by CBA, applications can be submitted/coverage can begin at any time 22

23 PFL 135 No Employee Contribution PFL 135 Has Employee Contribution * Employers will instead use DBL 135/136 if offering DBL (PFL as a rider) for the first time 23

24 Cancellation Coverage must be maintained for at least one year and may only be canceled after providing 12 months notice to all affected unrepresented employees and to the Workers Compensation Board Employees covered by CBA will abide by those terms Can keep DBL-only, if desired 24

25 Employer Responsibilities Post & maintain Paid Family Leave Notice of Compliance Creation of new PFL policy and revision/reminders on internal policies such as FMLA, PTO, leave policies and call-in procedures Coordination with Payroll vendor & insurance billing cycles 25

26 Dan Colacino Rose & Kiernan, Inc Shauna Waldin, PHR, SHRM-CP Rose & Kiernan, Inc This information is intended to assist employers with compliance and administration of their benefits plans and is not intended to be legal or tax advice. This presentation may not be reprinted or duplicated in any form without the express consent of Rose & Kiernan, Inc.