Massachusetts will soon join the growing list of states mandating paid family and medical leave for employees. Beginning January 1, employees in Massachusetts will be eligible to receive benefits established by the commonwealth’s new Paid Family Medical Leave (“PFML”) law. PFML provides paid leave for individuals facing a health crisis, bonding with a child, or caring for a sick relative. Massachusetts employers should be taking steps now to ensure that they can meet their PFML obligations come the new year. This post provides a brief overview of PFML and action items for employers.
Employers can comply with PFML either by: (1) participating in the state plan, which is funded by a state tax; (2) administering a private plan (either self-funded or through a third-party insurer) that must be approved by the state and offer equal or better benefits to employees.
PFML entitles a covered employee to take up to 26 weeks of paid leave for any of the following qualified reasons:
The remaining PFML benefits will become available on July 1, 2021, at which time a covered individual will also be entitled to up to 12 weeks of paid leave to care for a family member with a serious health condition.
Leave benefits are funded by employer contributions, which are calculated based on the number of employees. Employers may deduct part of their required contributions from employee wages. For medical leave, employers may not deduct more than 40% of their required contribution from wages. For family leave, they may deduct up to 100%.
An employee taking PFML leave is expected to give their employer at least 30 days’ notice. They should provide the anticipated start date of the leave, anticipated length of the leave, and anticipated date of their return. Of course, employers should be flexible when extenuating circumstances make 30 days’ notice impracticable.
On the flip side, Massachusetts employers are obligated to restore an employee returning to work after medical or family leave to their pre-leave position. This includes job status, pay, benefits, length-of-service credit, and seniority. The taking of PFML also may not affect an employee’s accrual of vacation time, sick leave, bonuses, or advancement. A presumption of retaliation exists for negative employment actions taken within six months of an employee’s leave. Finally, employers must continue providing for employment-related health insurance benefits, regardless of whether an employee is currently on leave.
An employer may apply for an exemption from contributions by demonstrating that it offers leave benefits through a private plan. A business seeking to do so should submit a Request for Exemption through the Massachusetts Department of Revenue’s MassTaxConnect system. A plan will be approved only if it: (i) provides the same or better benefits as those provided by PFML; (ii) does not cost employees more than they would be charged to receive PFML; and (iii) provides for an appeals process with the private plan administrator prior to an appeal through the Department of Family and Medical Leave (the “Department”). An employer denied an exemption by the department may request supplementary review of the decision.
In an upcoming blog post, we will review frequently asked questions from Massachusetts employers as they prepare for January 1, 2021. In the meantime, please reach out to your Foley & Lardner LLP Labor & Employment attorney for assistance with the Massachusetts law, or with paid family and medical leave requirements in any state where you have employees.