Paid Family Leave

Updates to New York’s Paid Family Leave Program

Are you ready to implement the New York Paid Family Leave Program? More details are still emerging.

A previous post discussed the basics of the New York Paid Family Leave Program that is set to take effect in 2018. Recently, the state has issued new proposed regulations and established the first maximum employee contribution.

Beginning as early as July 1, 2017, employers may deduct up to 0.126% of an employee’s weekly wage with a maximum deduction of $1.65 per week.

Revised Paid Family Leave Regulations

On May 24, 2017, the New York Workers’ Compensation Board (WCB) issue new proposed regulations regarding the New York Paid Family Leave Program. These regulations replace those originally proposed on February 22, 2017. The new regulations have a 30-day comment period.

The new regulations are substantially similar to the ones proposed in February. However, there are some potentially significant changes, including the following:

  • Eligibility is now based on hours rather than days worked. Employees who regularly work less than 20 hours per week become eligible for paid family leave on the 175th day of employment. Employees who work 20 or more hours per week become eligible on the 26th consecutive work week of employment.
  • Hours now also determine waiver eligibility. Employees who will not meet the above thresholds in a 52-week period may file a waiver and avoid paying into the paid family leave program.
  • The regulations now provide that if leave qualifies under both the NY Paid Family Leave law and the FMLA, then the employer may require the employee to use other accrued paid leave. However, it’s not clear that the FMLA would permit this, and the federal law would likely trump the state law on this issue. Under the FMLA, an employer can only require an employee to use available paid leave to replace “unpaid” FMLA leave. But because the New York law would convert the leave to “paid” leave, it seems that an employer would violate the FMLA by requiring the use of other paid leave concurrently with the NY Paid Family leave.
  • The new regulations require employees to notify their employer for each day of intermittent paid family leave. The original regulations only required notice one. This is now more in line with the FMLA.

Further Guidance on Deductions to Fund Paid Family Leave

With its May 24th version of the proposed regulations, the WCB responded to concerns about employers being able to start making payroll deductions on July 1, 2017. Although no employees are eligible to take paid family leave under New York law until January 1, 2018, the WCB notes that employers may take deductions in advance to fund the necessary insurance policies.

On June 1, 2017, the New York State Superintendent of Financial Services issued her “Decision on Premium Rate for Family Leave Benefits and Maximum Employee Contribution for Coverage Beginning January 1, 2018.”  With no experience under the Paid Family Leave Program, the initial deduction allowance is based on claims and demographic data from New York’s statutory disability insurers and data from other states with paid family leave programs, among other sources.

The Superintendent determined that the maximum employee contribution for coverage beginning January 1, 2018, is 0.126% of an employee’s weekly wage up to the statewide average weekly wage. As of March 31, 2017, the New York State Average Weekly Wage is $1,305.92.

For an employee making $1,305.92 or more per week, the weekly premium contribution cannot exceed $1.65, or approximately $86 per year.

Should Employers Begin Making Paid Family Leave Deductions?

Employers should consult with their disability insurance carriers or administrators in determining when to begin making deductions for paid family leave insurance and the proper amounts. It remains possible that the State will change regulations that affect these deductions. For example, there is still uncertainty as to who will ultimately have the right to waive participation and how they will do so.

If you have employees in New York, this will not be the last you hear about this topic. Please subscribe to my newsletter to receive updates on the New York Paid Family Leave Program among many other topics.