07 Sep

August 2020 Massachusetts HR Legal Updates

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Massachusetts Releases Final Regulations for Paid Family and Medical Leave

What happened?
Following a truncated period of public comment and hearings, the Massachusetts Department of Family and Medical Leave (Department) released the final regulations under the Massachusetts Paid Family and Medical Leave Law (PFML), effective July 24, 2020. Beginning on January 1, 2021, all private Massachusetts employers must provide covered individuals with paid family and medical leave, funded through a payroll tax.

What are the details?
The changes made by the final regulations are summarized below:

Private Plan Exemptions
Under the PFML, employers have the option of providing equivalent benefits to their employees through an approved private plan or self-insurance. The Department has significantly modified the regulations concerning exemptions through adoption of a private plan. While employers may continue to apply for an exemption from medical leave, family leave, or both, the final regulations prohibit the grant of an exemption for a private plan that covers only a portion of the workforce. Instead, per the PFML regulations, all employees, covered workers, and former employees must be included within the private plan in order for the employer to be exempted.

Applications for Benefits and Benefit Availability
The final regulations now require the covered individual to provide notice to their employer prior to applying for benefits. The Department will reject benefits applications absent proof of such notice. Covered individuals must submit benefits applications at least 30 days in advance of the anticipated leave start date, but no more than 60 days in advance. The final regulations, however, also provide that covered individuals may file applications as soon as practicable, if the covered individual was unable to meet the filing deadline for reasons beyond the covered individual’s “reasonable” control.

Reductions to Benefits
The final regulations add additional categories of wages or wage replacement benefits that will reduce PFML benefits. The weekly benefit amount is calculated on the individual’s average weekly wage at the time of the filing of a leave request, which is determined by the individual’s earnings in the base period as reported to the Massachusetts Department of Revenue. In addition to unemployment benefits or any state or federal disability benefits, the final regulations provide that the weekly benefit amount will also be reduced by benefits received from an employer through an approved, exempted private plan or any wages received from “another employer or covered business entity or through self-employment.” The final regulations remove language that the weekly benefit amount may be reduced where a covered individual has an outstanding tax obligation or obligation for child support.

Waiting Period
The final regulations clarify that there will be an initial seven-day waiting period for each application for benefits with the exception of medical leave during pregnancy or recovery from childbirth if supported by a healthcare provider that this medical leave follows immediately after the family leave.

The final regulations update some of the definitions as well. The final draft can be found here.

What do employers need to do?
Employers in Massachusetts should review the changes made and update their employee handbook sections dealing with leaves. Additionally, they should adjust their payroll practices to account for the increased cost to fund the PFML.

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