How is your company coping with New York Paid Family Leave so far? Remember that the paid family leave rates change next year. This includes both how much employees will pay for this statutory benefit and how much they can receive.

Employee Contributions

The New York Department of Financial Services (DFS) has announced the maximum employee-contribution rate for 2019. It will increase from 0.126% to 0.153% of the employee’s gross wages, up to an annual maximum. This maximum annual contribution will be $107.97 in 2019 compared to $85.56 in 2018.

This means an additional cost of up to $22.41 for many employees.

Paid Family Leave Benefits

But it’s not all bad news for workers. DFS also confirmed that the weekly paid family leave benefit will increase in 2019. The weekly benefit rate increases from 50% of the employee’s average weekly wage to 55%. This percentage only applies up to the first $1,357.10 of weekly earnings. An employee who earns more than that can only receive $746.40 per week in paid family leave benefits.

Plus, as originally scheduled, eligible employees may take two more weeks of paid family leave in 2019. The maximum allowance increases from 8 to 10 weeks.

Future Paid Family Leave Rates

Expect the contribution and benefit rates to change again.

Under the original schedule, maximum weekly benefits will increase to 60% of the average weekly wage in 2020 and 67% in 2021. The NYS Superintendent of Financial Services could delay these increases, but did not do so for 2019.

The maximum leave allowance will increase to 12 weeks per year beginning in 2021.

What Must Employers Do?

Companies should confirm their 2019 paid family leave premiums with their insurance carriers. Then make sure that next year’s payroll will include the correct contribution rates.

If your paid family leave policy reflects specific paid family leave rates for 2018, then you might need to change those.

This is also an excellent opportunity for employers to review which employees are eligible to opt out of the paid family leave program. Employers must offer qualifying employees the chance to waive coverage (and corresponding paycheck deductions). However, the waiver automatically expires if the employee later becomes eligible for paid family leave.

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