On Jan. 1, 2019, employers need to begin collecting paid family- and medical-leave premiums; budget for the employer share of the premium; and begin tracking hours and wages of all employees, including seasonal, temporary and part-time workers.
This requirement is due to passage of the state’s new paid family- and medical-leave program in 2018. The premium collections start Jan 1, 2019, but the benefits don’t begin until Jan. 1, 2020. Don’t be confused with the still relatively new paid sick-leave program. Family and medical leave is something altogether different.
The law impacts all employers, but there are important differences for small businesses: Businesses with fewer than 50 employees are not required to pay the employer portion of the premium, but are required to remit employee-paid premiums to the Employment Security Department and abide by all reporting requirements. Small-business assistance grants are available to businesses with 50 to 150 employees and to businesses with fewer than 50 employees who choose to pay the employer share of their employee’s premium.
Other important details:
- The premium for 2019 is 0.4% of an employee’s gross wages. To estimate your premiums, use the premium calculator.
- Under the law, employers may split the cost of the program with employees by withholding up to 63% of the premium from their paychecks.
- An employer can elect to pay all or some of their employees’ share of the premium on their behalf.
- Premium withholdings are capped at the Social Security cap ($128,400 in 2018).