Washington State PFML: Open for Business on Voluntary Plans; Proposed Phase Three Rules Released

Posted on: September 17, 2018 0

BY MARTI CARDI, VP-PRODUCT COMPLIANCE 

I wish I could receive Frequent Flyer miles for all the “trips” I am making back and forth between the East and West Coasts, covering developments in state paid family and medical leave programs. The most recent news is 2 tidbits from Washington State.

Voluntary Plans Now Being Accepted.  All employers must provide paid family and medical leave benefits to their employees, but the state provides the option of using the state plan or a “voluntary plan” administered by the employer or a third party administrator or insurer.  A voluntary plan must be approved by the state before it is effective.  As of September 17, the state is accepting applications for approval of voluntary plans.   Employers can apply and file their plans for approval here.  That site also provides lots of helpful information for employers considering a voluntary plan.  An employer must complete the application, submit a copy of its voluntary plan, and pay a $250 fee before the application will be considered complete.  Because the process is brand spankin’ new, the ESD is not yet providing information regarding how long it will take to get plan approval (or rejection). 

Matrix will offer administration of voluntary plans for our clients.  We’re developing a sample voluntary plan that our clients may choose to use, with appropriate employer-specific provisions.  We anticipate this will be ready for client review by approximately October 1 – but it is a detailed process so bear with us as we work to develop a top-notch plan.

Proposed Phase Three Rules Released

The state has released the draft rules for Phase 3 of the state’s PFML rulemaking process.  Sounds dry – and it is – but these rules, once finalized, give employers and TPAs like Matrix more detailed information regarding how to comply with the Washington paid family and medical leave law.

The Employment Security Department (ESD) is charged with developing the rules and, ultimately, administering and enforcing the law.  We wrote about the rules in a prior blog post.  At that time ESD was only planning on 4 rulemaking phases.  This has now been expanded to 6 phases.  The details change periodically as circumstances necessitate.  You can keep an eye on the timeline – if you care to! – on the state’s PFML Rulemaking site, or you can watch this blog for updates.  All proposed and final rules are also available on that page.

The Phase Three Proposed Rules cover benefit applications and benefit eligibility.  Here are some highlights:

  • Definitions:
    • Under the WA PFML statute, parents who are entitled to take paid leave include “de facto” parents and
      those in loco parentis to the child. A “de facto parent” is someone who has fully committed to the parental
      role with the consent of the legal parent.  Someone in loco parentis to a child has intentionally taken over
      parental duties and is responsible for the child’s well being.
    • A “claim year” is the 52-week period starting on the date of birth or placement of a child, for bonding leave,
      and on the date a completed leave application is filed for all other types of family and medical leave.
      NOTE:  This appears to create a situation where, for foreseeable leave other than bonding, the employee only
      has 11 months in which to take the leave, since the claim year includes the 30-day advance notice period. 
  • Employee notice to employer:
    • An employee must give notice of the need for leave at least 30 days in advance for foreseeable leave, and
      as soon as practicable when the employee becomes aware of the need for leave less than 30 days in advance.
      Generally this means notice the same or next business day once the employee is aware of the need for leave,
      but the employer should take into account the particular facts of the employee’s situation.
    • The employee’s notice to the employer must be in writing (hallelujah!) and must include the anticipated timing
      and duration of the leave. Under the proposed rule, written notice includes “handwritten, typed, and all forms
      of written electronic communications, such as test messages and email.”
    • If an employee provides late notice (presumably without extenuating circumstances) the employee’s benefits
      can be denied for the period of time the notice was late. NOTE:  The proposed rule does not specify exactly
      what this denial of benefits means:  Does the time off still count toward the employee’s paid leave entitlement
      to shorten the remaining time and benefits available, or is it more of a delay of benefits, with the employee still
      able to take the full 12 weeks of leave (or 16 or 18 weeks, depending on circumstances)?  Does the employee
      have job protection but not benefits, or no protections or benefits under the law at all during the period
      of late notice?
       
  • Initial application for benefits:
    • Employees must make application through the procedures the state will make available, or as defined in
      a voluntary plan if the employer elects this route.
    • An employee must support each claim for benefits with documentation as specified in the rules: For the
      employee’s own serious health condition or to care for a family member, the employee must provide a
      certification from a health care provider documenting the serious health condition and other relevant
      information.  For bonding, acceptable documentation includes a birth certificate, court documents, or
      other written documentation.  For military exigencies, documentation includes military orders but a
      “statement” to show why the leave is necessary is also acceptable.  NOTE:  The proposed rule does not
      explain from whom the statement must come.  Must the employer accept a written statement of the need
      for leave from the employee him/herself?
    • An employer can require the employee to provide documentation of a familial relationship to support
      benefits eligibility, such as a birth or marriage certificate or court document.
    • The proposed rules provide explanations of how an employee’s average weekly wage and weekly benefits
      are calculated. We’ll wait until these are finalized before diving into a big discussion here.
    • Hourly employees’ “typical workweek hours” are determined by dividing the total hours worked in a
      qualifying period by 52. NOTE:  This does not take into account that, according to informal guidance from
      the ESD, it is possible to establish eligibility in fewer than 4 prior quarters.  So for example, dividing hour
      worked in 3 quarters by 52 would significantly understate the employee’s typical work week.
    • If an employer is using the state benefits plan, the ESD will send the employer notice when an employee
      has applied for benefits. NOTE:  There is no time specified by which ESD must send this notice to the employer.

An observation:  So far, the final Phase One rules and the proposed Phases Two and Three rules have not added much substance.  Compared to the federal FMLA regulations that really flesh out FMLA rights and procedures, the WA PFML rules so far seem more to provide tiny slivers of information, in some cases merely repeating things already in the statute itself.  It appears that much of the real details will have to be developed over time through experience.  Good luck, employers!

Matrix can help!  As always, we are tracking and analyzing developments regarding the Washington Paid Family and Medical Leave Program.  Matrix will offer development and administration of voluntary plans for those employers who choose this route rather than putting themselves in the hands of the state.  With  required employee and employer premium payments beginning in 2019 and benefits beginning in 2020, it’s time to get started!.  If you have questions, contact your Account Manager or ping@matrixcos.com.

 

Meanwhile, Back in New York  . . .  Increases in PFL Benefits, Durations, and Premiums

Posted on: September 5, 2018 0

BY MARTI CARDI, VP-PRODUCT COMPLIANCE 

Here we are, 8 months into the first year of paid family leave in the state of New York.  My attention, and that of many employers, has been diverted somewhat to the upcoming paid family and medical leave law enacted by the state of Washington, with premium collections beginning in January 2019. (For more information on Washington, you know where to go: www.matrix-radar.com, and search for anything about Washington.) 

But New York marches on, and we are closing in on changes to the NY PFL program that will go into effect January 1, 2019.  The statute itself has built-in annual increases in the employee benefits percentage and leave duration for the 3 years after implementation.  In addition, the Superintendent for the NY Department of Financial Services is to publish by September 1 of each year the rate for employee premiums for the policy period beginning on the following January 1. That information was released on August 31, 2018, and is available here.

Here’s how NY PFL premiums and benefits compare from 2018 to 2019:

Effective Duration State Annual Weekly Wage (AWW) Employee Premium* (capped at same % of state AWW) Maximum Employee Premium Employee Benefit (capped at same % of state AWW) Max Benefit per Week
Jan 1 – Dec 31, 2018 8 weeks $1,306 0.126% of employee’s weekly wage $1.65 / week

 

$85.56 / year

50% of employee’s AWW $652.96
Jan 1 – Dec 31, 2019 10 weeks $1,357.11 0.153%  of employee’s gross wages each pay period $2.08 / week

 

$107.97 / year

55% of employee’s AWW $746.41

*The state uses slightly different terminology to describe the employee’s payroll contributions in 2018 and 2019, but the result should be the same – take the premium out of the employee’s paycheck at the proper percentage of that pay period’s wages until the maximum annual employee premium has been met.

Carryover of leaves from 2018 to 2019

At this point, one pressing question on employers’ minds is how much leave and benefits are available if an employee’s leave starts in 2018 but carries over into 2019? Here are some FAQs from the NY PFL website update for 2019:

  • If I start my continuous leave in 2018, and it extends into 2019, am I eligible for the benefits at the
    2019 rate and an extra two weeks?

    You get the benefit rate and number of weeks in effect on the first day of your leave.

Managing an intermittent leave that carries over is – of course! – more complex:

  • If I start my intermittent leave in 2018, and it extends into 2019, am I eligible for the benefits at the
    2019 rate and an extra two weeks?

    You get the benefit rate and number of weeks in effect on the first day of a period of leave. When more than
    three months passes between days of Paid Family Leave, your next day or period of Paid Family Leave is
    considered a new claim under the law. This means you will need to file a new Request for Paid Family Leave
    and that you may be eligible for the increased benefits available should this day or period of Paid Family
    Leave begin in 2019.

Remember that, in all events, the amount of leave an employee can take is measured looking back 52 weeks from the date of most recent usage.  Here is an example of how to assess an employee’s leave rights in 2019 if the employee used all 8 weeks available in 2018:

  • I used all eight weeks of PFL in 2018. Can I take more PFL in 2019 if I experience another qualifying event?
    If you experience another qualifying event in 2019, you may be eligible for up to two weeks of additional leave.
    The maximum amount of leave in 2019 is 10 weeks in a 52 week period. If you took eight weeks of PFL in the last
    52 weeks, and have another qualifying event in 2019, you may be limited to two weeks at the new rate, since it is a
    rolling calendar. When it has been 52 weeks from your 2018 leave dates, you will accrue a new week of available PFL,
    up to another eight weeks.

MATRIX CAN HELP!

As state and federal programs proliferate, Matrix provides leave, disability, and accommodation management services to employers seeking a comprehensive and compliant solution to these complex employer obligations. We monitor the many leave laws being passed around the country and specialize in understanding how they work together.

If you have questions, contact your Account Manager or ping@matrixcos.com.

Bring it On – Washington Paid Family and Medical Leave!

Posted on: August 23, 2018 0

BY MARTI CARDI, VP-PRODUCT COMPLIANCE 

 

Reliance Standard and Matrix are planning a series of Webinars to keep you up to date on this topic. The first series will be August 28 and 29, 2018 @ 11:00 am PDT / 2:00 pm EDT and will be hosted by Marti Cardi, Vice President Product Compliance, Dave Lea, West Coast Regional Practice Leader and Chris Smith, Practice Leader, Leave, Disability and ADA.

Please click here  to register for the 28th and here  for the 29th.

Starting in 2020, Washington will be the fifth state in the nation to offer paid family and medical leave benefits to workers. The program will be funded by premiums paid by both employees and employers. This paid leave law will allow workers to take, in a 12 month period:

  • Up to 12 weeks of paid leave when they welcome a new child into their family, need to take care of an
    ill family member, and for certain military-related family needs.
  • Up to 12 weeks for the employee’s own serious health condition. An additional 2 weeks of paid leave may
    be available if the serious health condition is pregnancy-related,
  • If workers experience multiple events in a given year, leave entitlement is capped at 16 weeks total for all
    leave reasons, (or up to 18 weeks if the employee’s serious health condition is pregnancy-related.
When does WAPFML go into effect?

Employers must start collecting benefit premiums from employees on 1/1/2019. Employee premiums and the employer’s premium contribution must be paid to the state quarterly throughout 2019 unless the employer has a state approved voluntary plan.

Below are some Key Issues and Provisions that you need to know right now.

Issue Provision
Effective Date ·   Premium contributions: 01-01-2019

·   Benefits: 01-01-2020

Employee Eligibility ·   Must work 820 hours in the “qualifying period,” defined as the first  4 of the prior 5 calendar quarters; OR

·   If the employee is not yet eligible, the preceding 4 calendar quarters.

·   [Equates to about 15.75 hours per week over 4 quarters]

 

Covered Employer All private employers, the state and subdivisions, and units of local government; no number of employees threshold
Job Protection ·   Employees covered by state plan:

     o   Works for an employer with 50 or more employees

     o   Has worked for employer for 12 months at start of leave

     o   Has worked 1250 hours in past 12 months at start of leave

·   Employees covered by a Voluntary Plan:

     o   Has worked for employer 9 of last 12 months at start of leave

     o   Has worked 965 hours in past 12 months at start of leave

Leave Reasons ·   Employee’s own serious health condition (defined same as FMLA)

·   Family member’s serious health condition

·   Bonding with new child (birth, adoption, foster placement)

·   Military exigencies (same as FMLA)

Duration in a 12-month period ·   Medical leave (employee’s serious health condition): 12 weeks

     o    2 additional weeks if employee experiences a serious health condition with a pregnancy that results in incapacity

·   Family leave (bonding, care for family member, or military exigency): 12 weeks

·   Maximum in 12-month period:

     o    16 weeks combined total for medical and family leaves

     o    18 weeks if employee experiences a serious health condition with a pregnancy that results in incapacity

Leave Calculation Method All leaves entitlements are measured forward 12 months from date of:

·   Birth or placement, for bonding

·   Employee’s filed application for leave benefits for all other leaves

Leave Use Increments ·   Full-hour increments

·   Minimum of 8 consecutive hours of leave

Covered Family Members ·   Child (any age)

·   Parent (includes step and in-laws)

·   Spouse

·   State-registered domestic partner

·   Sibling

·   Grandparent

·   Grandchild

 

Benefit Amount
AWW = average weekly wage
·   Employees who make 50% or less than the state’s AWW will receive 90% of their AWW.

·   Employees who make greater than 50% of the state’s AWW will receive:

      o    90% of their wages up to 50% of the state’s AWW; PLUS

      o    50% of their AWW in excess of 50% of the state’s AWW (subject to the $1000 cap)

Maximum benefit ·   2020: $1,000/week

·   Adjusts annually as of September 30 each year; effective the next January 1

Waiting Period ·   No waiting period for bonding leave

·   7 day waiting period for all other leave reasons

Funding Mechanism

 

AWW = average weekly wage

·   Net result: Employee pays 67%, employer pays 33%

·   2019 and 2020: total premium for medical and family leave benefits of 0.4 percent of employee’s wages, capped at the state’s AWW; then annual adjustments

·   Premium for medical leave (employee’s own SHC) = 2/3 of tot premium

      o    Employee pays 45% of this

·   Premium for family leave = 1/3 of total premium

      o    Employee pays all of this

·   Employer may elect to pay all or a portion of the employee’s share of the premium

Administration WA Employment Security Department
Existing Employer Paid Leave Benefits Employers may:

·   Adopt or retain leave policies more generous than any policies that comply with the requirements of the WA Family and Medical Leave Program ; or

·   Make payments to supplement the benefit payments provided under the Program to an employee on family or medical leave.

Employer Voluntary Plan ·   Detailed provisions for employer voluntary plans that offer benefits at least as beneficial to employees as the state plan

·   No provisions (or prohibitions) for insured voluntary plans

 

Relationship to Existing WA Family Leave Act The existing WA Family Leave Act will be repealed as of 12-31-2019, the day before the new PFML program goes into effect.  No information yet on how leaves started in 2019 will carry over interact with the law effective for leaves 1/1/2020.

MATRIX CAN HELP!  Matrix provides leave, disability, and accommodation management services to employers seeking a comprehensive and compliant solution to these complex employer obligations. We monitor the many leave laws being passed around the country and specialize in understanding how they work together. For leave management and accommodation assistance, contact us at ping@matrixcos.com.

Hawaii Enacts Law to Require Analysis for Paid Family Leave

Posted on: July 13, 2018 0

BY MARTI CARDI, VP-PRODUCT COMPLIANCE & GAIL COHEN, DIRECTOR-EMPLOYMENT LAW/COMPLIANCE

Hawaii is moving closer to a paid family leave program with legislation signed by the Governor on July 5.  The law does not enact a PFL law but requires the state Legislative Reference Bureau to conduct an analysis to assist the legislature in determining the most appropriate framework or model for the establishment of paid family leave for the state.

The analysis will include a comparative analysis of other state paid leave models, including temporary disability insurance models. Factors to be considered include scope of coverage; gender equity; ease of making applications or claims; speed of benefit payment; and financial sustainability.  The analysis will also assess cost and other impacts on employers and employees.  The Bureau’s final report must include its findings, recommendations, and proposed legislation, to the legislature no later than September 1, 2019.

Hawaii currently has paid temporary disability benefits for up to 26 weeks per benefit year for an employee’s own disability and an unpaid family leave law that provides up to 4 weeks per calendar year of job-protected unpaid time off.

 

MATRIX CAN HELP!  Matrix provides leave, disability, and accommodation management services to employers seeking a comprehensive and compliant solution to these complex employer obligations. We monitor the many leave laws being passed around the country and specialize in understanding how they work together. For leave management and accommodation assistance, contact us at ping@matrixcos.com.

California Updates Its Paid Family Leave Law with a Clean-Up Bill

Posted on: July 12, 2018 0

BY MARTI CARDI, VP-PRODUCT COMPLIANCE & GAIL COHEN, DIRECTOR-EMPLOYMENT LAW/COMPLIANCE

 

NOTE TO READERS:  This topic was originally addressed in this blog on July 12, 2018.  That post sparked some questions about the California Paid Family Leave program that make it appropriate to issue this revised article.  The content of the original post was accurate but is now supplemented with additional information in this version, specifically relating to the two weeks of PTO an employer can require an employee to use before taking California PFL.

______________________________________

Today’s post is not exactly earth shattering news, but we promise to keep you up to date on developments in leave laws and accommodations.  California has enacted a bill that makes a minor adjustment to the state’s paid family leave program – mostly a “technical correction” really. (CA A 2587)

The state family temporary disability insurance program, also known as the paid family leave program, provides wage replacement benefits to workers who take time off to care for a seriously ill family member or to bond with a minor child within one year of birth or placement of that child.

Existing California law allows an employer to require an employee to use up to 2 weeks of earned but unused vacation time before, and as a condition of, the employee’s initial receipt of paid family leave benefits during any 12-month period. Prior to January 1, 2018, California imposed a 7-day waiting period before employees could begin receiving benefits for a covered absence and the employer could apply that vacation pay to cover the waiting period. The 7-day waiting period for these benefits was eliminated as of January 1, 2018, by a prior law.

This new California law now eliminates the application of vacation leave to the waiting period, consistent with the removal of the 7-day waiting period for these benefits on and after January 1, 2018. After all, you can’t apply the employee’s vacation pay to the 7-day waiting period because there no longer is a 7-day waiting period.  Technically the effective date is January 1, 2019, but as there has been no waiting period since January 1, 2018, there has been nothing to which to apply that accrued vacation.

Employers are still able to require employees to use up to two weeks of accrued vacation or PTO, if available, prior to receipt of PFL benefits.  The use of such accrued paid time off is in addition to the 6 weeks of state or voluntary plan paid family leave benefits, which will follow the 2 weeks of PTO.  The statute refers to use of accrued “vacation” but material from the California Employment Development indicates that this includes an employer’s broader paid time off benefit as well.

Matrix can help!  Matrix is a leading provider of services for administering California State Disability Insurance and Paid Family Leave voluntary programs.  Ping us for more information at ping@matrixcos.com.