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.

 

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.