Updated February 11, 2021
FMLA (PFMLA) Changes 2021 FAQ
FMLA is a law created at the US Federal Level, while PFL provides benefits to employees at the state (in our case Massachusetts) level. FMLA is not a paid medical leave. There is no consideration of compensation to company employees taking time off.
- PFML is a paid family and medical leave program funded through mandatory payroll taxes and administered by the Department of Family and Medical Leave (DFML)
- The payroll taxes (also referred to as contributions) are paid by:
- Covered business entities
- Employees (W-2 workers)
- Covered contract workers (covered 1099-MISC workers)
- Self-employed individuals electing coverage
- The PFML law applies to virtually all MA employers and covered business entities, provided:
- An individual employer is determined by the FEIN
- The Department of Early Education and Care is deemed the employer of family child care providers and that PCA Quality Home Care Workforce Council is deemed the employer of personal care attendants
- Any employer not subject to PFML may become a covered employer by notifying the Department of Family and Medical Leave (DFML)
- A municipality, district, political subdivision, or its instrumentalities are not subject to PFML unless it adopts coverage under PFML by majority vote of its authorized local legislative or governing body
- A covered business entity is a business or trade whose total workforce (i.e., employees plus 1099-MISC contractors) is comprised of more than 50% of 1099-MISC workers (More on why this is important later!)
The Massachusetts Department of Family and Medical Leave recently amended the Massachusetts Paid Family and Medical Leave Act (PFML) final regulations. This article provides an overview of PFML and a checklist of items to consider for preparing for January 1, 2021, the first-day PFML benefits become available to eligible employees.
PFML provides paid leave for up to 20 weeks for medical leave when an employee is unable to work due do a serious health condition; 12 weeks of family leave to bond with a newborn or child placed for adoption or foster care, to care for a family member with a serious health condition, or for a qualifying exigency resulting from a member’s call to active duty; and 26 weeks to care for a family member who is a service member. The maximum leave that may be taken in any benefit year is 26 weeks of combined family and medical leave.
Definition of Family Member
For businesses with over 50 employees that are subject to the federal Family and Medical Leave Act (FMLA), it is important to know for coordination purposes that PFML defines a family member far more broadly than the FMLA. FMLA defines a family member as a spouse, parent (including in loco parentis), and child. Under PFML, family members include a:
- Spouse or domestic partner
- Parent or parent of a spouse or domestic partner
- Person who stood in loco parentis to the covered individual when a minor child
PFML may be taken on an intermittent or reduced leave basis, and when so, benefits are prorated. Intermittent leave may only be taken if “medically necessary” for the covered individual’s own serious health condition or to care for a family member with a serious health condition or who is a covered service member.
In addition, a covered individual may take family leave due to a qualifying exigency arising out of a family member’s active duty or impending call to active duty. However, a covered individual cannot take intermittent leave to bond with a child because of birth or placement for adoption or foster care unless both the employer and covered individual agree.
Employers can designate a minimum increment of time to be taken as intermittent leave for all employees. The recent amendments changed the minimum increment from four hours to 15 minutes. In addition, the amendments provide that an individual may not apply for payment for intermittent leave until they have accumulated eight hours of leave unless more than 30 calendar days have elapsed since leave started.
DFML will pay benefits directly to employees. Benefits begin after a seven-day waiting period during which employees may use their accrued PTO, vacation, and/or other employer-provided paid leave. The maximum weekly benefit is capped at $850. The income replacement ratio ranges from 80 percent for an individual whose average weekly wage is $510 ($12.75/hour) compared to 35 percent for an individual whose average weekly wage is $2,400 ($60/hour).
Substitution of Employer-Provided Leave
Covered individuals may choose to use employer-provided accrued paid leave or leave through an extended illness bank program rather than PFML. Those who do will not receive any PFML benefits while receiving the payments. Businesses must inform covered individuals that the accrued leave and extended illness bank runs concurrently with PFML, and upon request from DFML, report the use of accrued leave taken by covered individuals.
Private Plan Exemption
A business may apply for an exemption from paying the payroll taxes for funding PFML benefits through the MassTaxConnect system by demonstrating they will offer a private plan that provides the same or better PFML benefits, including that individuals will still be entitled to all rights and protections provided under PFML. A business may apply for an exemption from making contributions for medical leave coverage, family leave coverage, or both. A business cannot apply for an exemption on behalf of only a portion of its covered workforce. At this time, several insurance carriers have been approved to offer insured and self-insured private plans.
What to Do Now to Prepare for FMLA Changes 2021
To prepare for 2021, use this checklist for action items to consider:
- Under PFML, the maximum number of weeks of leave a covered individual may take is based on benefit year, i.e., the 52-week period beginning on the Sunday immediately preceding the first day leave begins. If your business is subject to FMLA, consider changing the 12-month period for determining maximum leave available to match the PFML benefit year to avoid overlapping periods.
- Review your paid time off programs to determine how best to coordinate them with PFML. For example, if you provide paid sick days that are more generous than the state’ earned sick time requirements, consider whether to design the program differently.
- Under PFML, lower paid individuals receive a higher percent of income replacement than higher paid individuals. Review your time off programs and disability insurance policies and consider what changes to make and talk with your broker about disability insurance policies that may be better designed to coordinate with PFML.
- Review your leave programs to establish what leaves can run concurrently. For example, PFML may run concurrently with FMLA and Massachusetts’ Parental Leave. This is important to avoid employees from stacking one leave on top of another.
- Identify potential administrative issues, including how PFML will be tracked and communicated to employees, and how your business will respond to DFML when requesting information for claim adjudication purposes. which must be provided within 10 business days.
- For family leave to bond with a newborn or child placed for adoption or foster care with an employee, determine whether your business will agree to intermittent leave, and if so, under what circumstances.
Pamela Sande is president and CEO of HR at Work, LLC (formerly Pamela Sande & Associates, LLC). HR at Work is based in Hyannis, Ma and is one of Massachusetts’ leading HR Companies. For more information, visit their HR Consulting Website please call 774-413-5774.
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