New York State passed a Paid Family Leave (PFL) law that provides partial income replacement and job protection while workers are on leave for covered reasons, such as bonding with their child (during the first 12 months following the birth, adoption, or fostering of a child), caring for a close relative with a serious health condition, or helping relieve family pressures when someone is called to active military service. Employees on PFL are also guaranteed to be able to return to their job and continue their health insurance. If employees contribute to the cost of their health insurance, they must continue to pay their portion of the premium cost while on PFL. The program is mandatory for all private employers, and public employers may opt-in.
The New York Paid Family Leave is designed to phase in over four years, starting January 1, 2018. Employees may take the maximum benefit length in any given 52-week period. The 52-week clock starts on the first day the employee takes Paid Family Leave.
The New York State Department of Financial Services (DFS) has set the maximum employee contribution rate for the first year at .126% of an employee’s weekly wage up to and not exceeding the statewide average weekly wage ($1,305.92 for 2018). A maximum rate of employees’ contribution will be established each year. Employers may choose to pay some or all of this on behalf of employees as an added employment benefit, but are not obligated to do so.
For the purposes of the family leave benefits rate, the applicable statewide average weekly wage is the most recent rate reported by the Commissioner of Labor to the Superintendent pursuant to Worker’s Compensation Law § 2(16) at the time the Rate Decision was published. It will remain in effect for the entire period for which the Rate Decision applies and will not change even though the Commissioner of Labor may report a new statewide average weekly wage during that time period. Specifically, the statewide average weekly wage for purposes of the family leave benefits rate for 2018 is $1,305.92; for purposes of the family leave benefits rate for 2018, this statewide average weekly wage will remain in effect until December 31, 2018.
Some employees may earn wages on an irregular schedule, such as where commissions or bonuses are part of an employee’s wages. Pursuant to the Rate Decision and Insurance Law § 4235(n) and to ensure a stable and functioning market, insurers must collect the correct premium based on the total annual wages earned by such employee. Each insurer must collect premiums equal to 0.126% of the employee’s annual wages for the calendar year up to and not exceeding 0.126% of the annualized statewide average weekly wage. For the calendar year 2018, the annualized statewide average weekly wage is $67,908, which means the maximum annual premium to be charged to an employee for paid family leave benefits coverage for 2018 is $85.56.
Paid Family Leave coverage will be included under the disability policy all employers must carry. The premium will be fully funded by employees through payroll deductions that employers are permitted, but not required, to begin deducting from employees starting July 1, 2017. Please provide notice to your employees prior to making payroll deductions from your employees for the Paid Family Leave.
Note: If you are a USA Payroll Disability Paygo client, your New York Paid Leave rider will be added to your policy automatically and the USA Payroll Agency will handle your payments. If you are not currently a USA Payroll Disability Paygo client and are interested in our services, please contact our insurance office at 585-643-2140 or by email at firstname.lastname@example.org.
For an Employee Notice in order to withhold the payroll deduction for the New York State Paid Family Leave, please refer here.