Oregon governor Kate Brown recently signed what many consider to be the nation’s most generous Paid Family Leave (PFL) law. The week prior, Governor Ned Lamont of Connecticut likewise signed generous PFL legislation into law. New Jersey, New York, California, Rhode Island and the District of Columbia’s PFL programs also are now well underway. Washington state dipped its toe into the payroll deduction pool earlier this year, while Massachusetts delayed its employee deductions from July 1 to October 1 (see our compliance alert here). Hawaii’s proposed PFL legislation is expected to become law in September. With all of this rampant PFL activity at the state and municipal levels, we provide some useful tidbits below on the newest PFL laws:
The Oregon program will be funded by contributions from employers with 25 or more employees and also by employee payroll deductions. The law will take effect in January 2023, covering employees who earned at least $1,000 in wages the previous year regardless of hours worked. Employees will be eligible annually for 12 weeks of pay for covered leaves including time off for new parents and those who have a serious health condition or need to care for a family member with a serious health condition. It will also provide paid leave for victims of domestic violence, harassment, stalking, or sexual assault. Oregon will be only the second state after New Jersey to include victims of domestic violence in its paid family leave law.
Weekly benefits will be capped at $1,215. The law will be funded through a payroll tax that cannot exceed 1% of employee wages, up to a maximum of $132,900 in wages, with employees paying 60% of the total rate and employers covering 40%. Employers with fewer than 25 employees are not required to pay the employer portion of the premiums.
The Connecticut program will be funded by both employers and employees with payroll deductions beginning on January 1, 2021. Payment of benefits begins on January 1, 2022. This act provides job protection for employees who work for at least three months with the same employer, with no minimum amount of hours required. Covered leave is for eligible employees, for up to 12 weeks annually, with a serious health condition or that of a covered family member; or family leave following childbirth, adoption or placement of a child in foster care. The total premiums and contributions are yet to be determined.
It will be interesting to see how PFL plays out among municipalities, states and as a national topic in the 2020 Presidential elections. And while this is great news for your employees (and the benefits are much deserved), you multi-state employers might be cringing at the thought of the additional administration involved. A great consultant will be able to help you navigate these increasingly complicated waters. In the meantime, stay tuned for our upcoming PFL guide in our Compliance Center.