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May 2023: Maryland Modifies Paid Family and Medical Leave Insurance Program

17 May

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Update Applicable to:

All Maryland employers.

What happened?

The Maryland General Assembly recently passed Senate Bill (SB) 828, modifying several provisions of Maryland’s Family and Medical Leave Insurance (FAMLI) program established by the Time to Care Act in 2022.

What are the details?

Effective June 1, 2023, SB 828 pushes back several dates governing the implementation of the Time to Care Act:

  • October 1, 2024, instead of 2023, for employers with 15 or more employees to begin program contributions.
  • January 1, 2026, instead of 2025, for covered employees to begin submitting program claims.

Despite the delayed implementation dates, the total rate of employer and employee contributions will still be set on or around October 1, 2023, and won’t exceed 1.2% of an employee’s wages. This rate will be effective from October 1, 2024, to June 30, 2026. Some additional changes (but not all) include:

  • A 50-50 split in the cost-sharing formula for program contributions between
  • employers and employees; and
  • The addition of domestic partners to the definition of covered family members and child bonding.

The Maryland Department of Labor is expected to release more information and guidance. In the meantime, it has selected the program’s assistant secretary. (MD SB 828 was signed by the governor on May 3, 2023). Employers may require that FAMLI benefits be coordinated with other benefits or leave. A covered individual and an employer may agree to use paid leave and FAMLI benefits to replace up to 100 percent of the covered individual’s average weekly wage during the FAMLI leave period.

SB 828 also reduces the specificity required in leave certifications that individuals will need to provide to support FAMLI leave benefits. While individuals must specify whether their leave will be taken continuously or intermittently, they no longer need to provide a statement certifying they are undergoing a “serious health condition.” Instead, they need only certify that they are “unable to perform the functions” of their positions. SB 828 does not affect the requirement that individuals must provide employers with at least thirty days’ advance written notice of their intention to take leave.

For more information, please see the links below:

Bill Page: SB 828

Law Firm Summaries/Opinions: Article 1, Article 2, Article 3

What do employers need to do?

Employers should take advantage of this time to identify covered employees, prepare their payroll systems to include any additional payroll tax, and to consult experienced Maryland employment counsel to review current paid time off, leaves of absence, and family and medical leave policies to account for these new requirements.

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This communication is intended solely for the purpose of conveying information. The present post might incorporate hyperlinks directing readers to websites managed by third-party entities. The inclusion of any links within this communication is meant to serve as points of reference and could encompass opinion articles from various law firms, articles from HR associations, official websites, news releases, and documents of government agencies, and other relevant third-party sources. Vensure has no authority over these external websites and bears no responsibility for their content. Furthermore, Vensure does not endorse the materials present on these websites. The contents of this communication should not be interpreted as legal advice or as a legal standpoint concerning specific facts or scenarios. Nor should it be deemed an exhaustive compilation of facts potentially pertinent to federal, state, or local laws. It is strongly advised that employers solicit legal guidance from an employment attorney when undertaking actions in response to any legal updates provided. This is due to the possibility of future alterations occurring in federal, state, and local laws, regulations, as well as the directives and guidelines issued by governing agencies. These changes may transpire at any given time, potentially rendering certain portions of the content within this update void or inaccurate.

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