Paid Family & Medical Leave

Transcription

1 Washington State Employment Security Department Paid Family & Medical Leave Nick Streuli, Director Legislative & Executive Operations Interagency Committee of State Employed Women (ICSEW) November 21, 2017

2 Executive Summary Premium Rates Voluntary Plans Business Assistance Rulemaking Benefit Duration Benefit Eligibility Wage Replacement Employment Protection Collective Bargaining Questions 2

3 Premium Rates The premiums for Paid Family and Medical Leave begin accruing January 1, For the first two years, total premium rate is 0.40% of employees wages up to the Social Security taxable wage base, $127,200. The employer must collect the premiums and pay to ESD. For calendar year 2021, the total premium rate will be determined through an account balance ratio calculation. Family & Medical Leave Account Balance / Total Covered Wages Premiums will range from 0.10% % based on the calculation. An additional solvency surcharge could be enacted if the fund balance drops too low. 3

4 Premium Rates The total premium rate is split into a premium rate for family leave and a premium rate for medical leave. For , the total premium rate will be split 1/3 for family leave and 2/3 for medical leave. Beginning in 2022, the split of the total premium rate for family leave and medical leave will be determined by the proportion of claims for each type of leave the following year. Employees pay up to 100% of the premium for family leave. Employees pay up to 45% of the premium for medical leave. Employers with fewer than 50 employees are not required to pay the employer portion of the premiums but can opt-in. 4

5 Premium Examples at 0.40% Employer 1 Employer 3 This employer would be exempt from premiums because they are under 50 and would only pay if they opt-in. Total Payroll 8 Employees $500,000/year Quarterly PFL Premium $185 Premium projections assume no employees earn over the taxable wage base of $127,200. Total Payroll 120 Employees $7,000,000/year Quarterly PFL Premium $2,590 Premium projections assume no employees earn over the taxable wage base of $127,200. Employer 2 Employer 4 This employer would be exempt from premiums because they are under 50 and would only pay if they opt-in. Total Payroll 40 Employees $2,000,000/year Quarterly PFL Premium $740 Premium projections assume no employees earn over the taxable wage base of $127,200. Total Payroll 500 Employees $30,000,000/year Quarterly PFL Premium $11,100 Premium projections assume no employees earn over the taxable wage base of $127,200. 5

6 Premium Examples at 0.40% Hrly Hrs/wk Annual Employee Weekly Contribution Employer Weekly Contribution $ $24,960 $1.21 $0.71 $ $28,080 $1.36 $0.80 $ $31,200 $1.51 $0.89 $ $52,000 $2.52 $1.48 $ $89,440 $4.33 $2.55 $ $127,192 $6.16 $3.62 6

7 Voluntary Plans Any employer may apply for a voluntary plan to provide either family or medical leave benefits, or both. The employer must have the plan reapproved annually for the first three years. After three years, the employer must submit the plan for reapproval if modified. The application fee is $250. If approved, neither the employee nor the employer pay premiums or file claims through the state program. The benefits must be equivalent or better than the state program including duration of leave and wage replacement. 7

8 Voluntary Plans The employer must maintain health insurance if required under FMLA. The employee remains responsible for their portion of the health insurance premiums. The employer may deduct from the employee up to what the employee would have paid under the state program. The employee may appeal benefit determinations through the process outlined in the state program. The employer must maintain all records relating to the voluntary plan and claims for six years. 8

9 Business Assistance Employers with fewer than 150 employees and employers with fewer than 50 who opt-in are eligible to receive certain grants. Employers who hires a temporary worker to replace an employee on leave for 7 days or more can apply for a $3,000 grant. Employers who incur significant additional wage costs due to an employee s leave can apply for a grant of up to $1,000. An employer may apply for no more than 10 grants per year and no more than once for each employee on leave. Employers in voluntary plans do not qualify for these grants. 9

10 Paid Family & Medical Leave rulemaking Oct 17-Jan 18 Dec 17-Mar 18 Feb-May 18 Apr-Jul 18 Jun-Sep 18 Premium liability Voluntary Plans CBAs Premium Calculation Premium payments Premium reporting requirements Collections Premium appeals Miscellaneous: Ombuds Advisory committee Remedies Premium cluster timeline and content 10

11 Benefit Duration Benefit claims begin January 1, 2020 Maximum of twelve weeks of family leave per year. Maximum of twelve weeks of medical leave per year. No more than sixteen weeks of family and medical leave per year. May be extended to eighteen weeks if the employee experiences a serious health condition with a pregnancy which results in incapacity. A week of leave is based on the employees typical workweek hours during the qualifying period. 11

12 Benefit Eligibility Benefits are portable across all employers. Employees covered in the state program qualify after working 820 hours in the qualifying period. Employees covered by voluntary plans have the same criteria but must work 340 hours with the current employer in the past 12 months. Employees who have worked 820 hours but don t yet have 340 hours with their employer in the voluntary plan may still take leave under the state program. 12

13 Wage Replacement The weekly benefit amount for family and medical leave claims is a percentage of the employee s average weekly wage. If the employee s average weekly wage is 50% or less of the state average weekly wage, the employee s weekly benefit amount is 90% of the employee s average weekly wage. If the employee s average weekly wage is more than 50% of the state average weekly wage, the employee s weekly benefit amount is the sum of 90% of the employee s average weekly wage up to 50% of the state average weekly wage, and 50% of the employee s earning above the state average weekly wage. The maximum weekly benefit amount is $1,000 adjusted annually to be 90% of the state average weekly wage. 13

14 Wage Replacement The wage replacement allows for a higher percentage of wage replacement for low-wage workers. This table shows the weekly benefit amounts at different wage levels and assumes these workers worked 40 hours per week. Hourly Salary Annual Salary Weekly benefit $ $ 24,960 $ 432 $ $ 28,080 $ 486 $ $ 31,200 $ 570 $ $ 56,264 $ 811 $ $ 84,968 $ 1,000 $ $ 127,192 $ 1,000 $ $ 520,000 $ 1,000 14

15 Employment Protection Employees covered by the state program are entitled to job restoration when returning from leave the same as FMLA: They work for an employer with 50 or more employees. They have worked for that employer or 12 months or more. They have worked at least 1250 hours for that employer in the past 12 months. Employees covered by a voluntary plan are entitled to job restoration when returning from leave if: They have worked for that employer or 9 months or more. They have worked at least 965 hours for that employer in the past 12 months. 15

16 Employment Protection Job Restoration can take several forms. Restored to the position of employment prior to taking leave; or Restored to equivalent position of employment prior to taking leave. No loss of benefits accrued prior to taking leave. Employer may deny job restoration if the employee is among the highest paid 10% of salaried employees within 75 miles of the place of employment. 16

17 Collective Bargaining An employee's rights to Paid Family and Medical Leave may not be diminished by a collective bargaining agreement or employer policy. Nothing in this act requires any party to a collective bargaining agreement in existence on October 19, 2017, to apply any of the rights and responsibilities of Paid Family and Medical Leave unless and until the existing agreement is reopened, renegotiated, or expires. 17

18 Questions? Nick Streuli Director, Legislative and Executive Operations Washington State Employment Security Department (360)