NY Implements Mandatory Paid Family Leave Policy

Effective January 1st, 2018, employers in New York State will be required to offer Paid Family Leave coverage for their workforce.  Employer’s should prepare now for this new coverage and can even voluntarily comply and start the coverage earlier.   Do not wait until December 31st.

New York will become the fourth state requiring family leave coverage, following California, New Jersey, and Rhode Island.  This coverage provides wage replacement and job protection to employees who need time off to bond with a new born, adopted, or fostered child, care for a family member with a serious health condition, or assist loved ones when a family member is deployed abroad on active military duty.  Nearly all private employees will be covered.  Employees with a regular work schedule of 20 or more hours per week are eligible after 26 weeks of employment, and employees with a regular work schedule of less than 20 hours per week are eligible after 175 days worked.

There will be a four year phase-in of the weeks of leave an employee can take off, starting with 8 weeks, increasing to 10 weeks in 2019, then 12 weeks in 2021.  This will be the longest family leave program in the nation where an employee can take off 12 weeks in a 52 week consecutive period, which starts the first day the employee takes the leave.  While on leave the employer is not required to accrue benefits for the employee such as paid time off.  If the employer offers a paid time off benefit, such as PTO or Vacation, the employer is prohibited from requiring their employees to use that time for the paid family leave.  The employee on leave will receive 50% of their average weekly wage, increasing to 55% in 2019, 60% in 2020, and stabilizing at 67% in 2021.  This employee’s average weekly wage is capped by the New York State Average Weekly Wage (NYSAWW), which can be found here.  The current NYSAWW is $1,305.92.

Similar to the NY State Disability Insurance (SDI), the employer may collect the cost of the coverage to offset their expense through payroll deductions with a maximum employee contribution of 0.126% of the employee’s weekly wage, up to the annualized NYSAWW.

In summary, here are the employer’s responsibilities;

• Employers should contact their disability insurance carrier about adding the Paid Family Leave coverage.
• Reinstate employees to their same or comparable job upon return from Paid Family Leave.
• Continue employees’ health insurance while they are on Paid Family Leave.  Employees can be required to continue to pay their health insurance premium contributions.
• Communicate the Paid Family Leave program to their employees.  This includes a new poster requirement (Check out our poster subscription service that will keep you in compliance.)
• Contact your payroll service to be sure they are setup to handle the employee deduction.

If you have employees in New York and have unanswered questions about this new required coverage, the state has created a website at ny.gov/paidfamilyleave or contact the state at 844-337-6303.