Learn about updates to the MA PFML program in the latest Line on Leave episode.
Eight states now have mandatory Paid Family Leave laws. This episode of The Hartford’s Line On Leave podcast focuses on the program in Massachusetts – MA PFML – and what employers need to know before benefits start in 2021.
MA PFML Episode Notes
This episode features Grant Van Der Beken, Regional Sales Director for MA, and Julie Crawford, Assistant Director for Product and Strategy, as we discuss Paid Family and Medical Leave in Massachusetts, and our host, Laura Marzi, Group Benefits Chief Marketing Officer. A number of important MA PFML topics are discussed to help employers and employees:
- Massachusetts was the 6th state to create a PFML program.
- Benefits are expected to begin January 1, 2021.
- Private plans are an option.
- MA PFML was created from scratch – there was no existing statutory temporary disability leave in MA before this program.
The lead up to launch was marked by delays in program deadlines when several business and advocacy groups asked for more clarity and time to prepare:
- The withholding deadline moved from July 1 to October 1, 2019 (deduction increased from 0.63% to 0.75% because of shorter time to collect premium) in order to pre-fund the program
- Employee notification moved from July 1 to September 30, 2019.
- Private plan exemption application moved from September 20 to December 20, 2019.
- The Department of Family and Medical Leave will oversee the program.
- Who is a covered employer?
All businesses with one employee, or more, working in Massachusetts are required to participate – exceptions include self-employed (may opt in) and municipal employers (may opt in).
- What employees are eligibility to receive benefits?
Employees must have worked 15 weeks or more and have earned at least $4,700 in the 12-month period before applying for benefits. All work – part-time, temporary and seasonal – counts toward eligibility. An employee that has been separated from the company for less than 26 weeks and remains unemployed, is still entitled to benefits.
Eligible employees can take leave to:
- Welcome a new child (through birth, adoption, or foster placement).
- Recover from a personal illness or injury.
- Care for an ill or injured relative.
- Care for an injured (while in the line of duty) or sick service member.
- Respond to certain military-connected events.
- What are the MA PFML benefits?
Employees may be entitled to:
- Up to 12 weeks of family leave (includes active duty family military leave and bonding time).
- Up to 12 weeks to care for a family member.
- Up to 20 weeks of personal medical leave.
- Up to 26 weeks of caregiver benefit for a service member.
Benefits are capped at a total of 26 weeks for a combination of Paid Family and Medical Leave in 52 weeks.
- How is the program funded?
Employers and employees share the cost:
- For the Paid Medical Leave portion: employer pays 60%, employee pays 40%.
- For the Paid Family Leave portion: employee pays 100%.
The premium is 0.75% of employee’s gross wages up to Social Security maximum (about $132,900 in 2019) – 0.62% will fund the Paid Medical Leave portion of the program and 0.13% will fund the Family Leave portion of the program.
- What are some MA PFML dates and deadlines employers should keep in mind?
October 1, 2019 – Employers required to provide written notice to employees about this new paid leave entitlement.
October 1, 2019 – Withholding begins for employee payroll deductions and remitted to state quarterly.
The DFML will announce reporting and documentation guidelines prior to Oct. 1, 2019.
December 20, 2019 – Due date for private plan applications for 1st quarter of program.
January 1, 2021 – Benefits begin for bonding with a new child, employees’ medical leave, family military or service member caregiver.
July 1, 2021 – Benefits begin for care of family member.
- What are the requirements for private plans?
Employers can self-insure or purchase a fully insured policy that has been approved by the Commonwealth. Both a fully insured policy and administration services for self-insured private plans are available from The Hartford.
An approved private plan must meet or exceed state requirements in:
- Leave duration
- Weekly benefit
- Job protection
- Requirement for employers’ maintenance of health benefits
Employer can choose to provide benefits for either Family Leave, Medical Leave or both. Employers who self-insure, can work with a third party, such as The Hartford, to administer benefits. In an approved private plan, there are no employer premium requirements. Employee contributions, however, cannot exceed the percentages as defined in the law.
If an employer opts to withdraw the private plan after deductions have started, but before the benefits are effective, the funds are remitted to the state.
Employers can choose to pay the employee portion of the cost.
Some things to know about self-funding options:
- Self-funded plans must be bonded.
- Massachusetts is in the process of finalizing bonding requirements.
- Stay tuned and we will update employers on those details as they become available.
- How can employers apply for a private plan?
Employers must apply for a private plan exemption through the Massachusetts Department of Revenue’s MassTaxConnect. If approved, they will receive a letter of instructions on next steps. The plan must be approved yearly.
MA is expected to provide more details on the application process over the next few weeks, so stay tuned.
- Employers will be notified the reasons for the denial.
- Employers can request a follow-up review.
- The state allows one private plan application per quarter. If employer’s application is denied, the employer must wait until the next quarter to refile different plan.
- Even if the plan is approved, employers must wait at least one year before making any changes to a private plan.
- How can The Hartford help?
- We offer review of the employer’s draft MA PFML self-insured plan to help employers assess if it matches, or exceeds, the mandatory requirements. Once the Commonwealth finalizes and approves the plan language that they would like to see used, The Hartford will create a self-insured template version to offer to employers for their use.
- We will also offer an approved MA PFML policy of insurance.
- We can administer an approved self-insured plan for PFML. Because of the shared entitlement requirements, we would advise employers to place both the Medical and Family Leave with the same administrator to make coordination easier.
- Having just one point of contact for Disability and Paid Family Leave claims, helps to simplify the claim experience for employees.
- Our absence management experience and RTW strategies help employers create plans that promote employee health and wellness.
- We are closely monitoring the evolution of all these PFML programs – state-by-state
- State of the art employee web experience and customer care center.
Important to partner with an organization that has:
- Absence management experience.
- Prevention and intervention.
- Ability to coordinate all of this to manage work and non-work absences
- Technology solutions for ease of claimant and employer accessibility, administration and metrics evaluation.
You can find additional resources on this topic on The Hartford’s Paid Family and Medical Leave resource center or our MA PFML page.
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