The Larkin Company Newsletter

California: Update
Connecticut: Update
Massachusetts: Update  
Oregon: Update
Rhode Island: Update
Washington: Update

California Governor Gavin Newsom recently signed SB 83 which expands the maximum duration of paid family leave benefits from six to eight weeks beginning on July 1, 2020.  The bill also calls for a task force to be created to assess and address job protection for employees, wage replacement rates up to 90 percent for low wage workers and provide a plan to implement and fund expanded paid family leave benefits to 12 weeks per employee (6 months total for parents taking paid family leave in succession).  Governor Newsom will present the task force’s findings to the Legislature in November 2019. 

Connecticut
On June 25, 2019, Governor Ned Lamont signed SB 1 which will create the Paid Family and Medical Leave Insurance Program, requiring employers to provide up to 12 weeks of paid leave per year.  Payroll contributions will begin January 1, 2021 with benefits payable beginning January 1, 2022.

Massachusetts
If you provided written notices regarding Paid Family and Medical Leave to your workforce prior to the June 14 delay announcement, you will need to provide them with an updated rate sheet explaining the new dates and contribution rates.  This sheet does not have to be signed by the covered individual and can be sent electronically -you’ll need to keep a record of its distribution.  This process will need to be completed each time that the rate changes.  

Rate sheet for employers with 25 or more employees: click here.
Rate sheet for employers with less than 25 employees: click here.

Oregon
Oregon will become the eighth state to approve paid family and medical leave benefits when Governor Kate Brown signs House Bill 2005.  The bill will provide workers who earned at least $1,000 in a year with 12 weeks of paid leave for their own serious health condition, to care for a sick family member, to bond with a new baby, or to deal with issues related to domestic violence, sexual assault, stalking or harassment.  The cost will be split 60-40 between workers and employers with contributions beginning in 2022 and benefits beginning in 2023.  Businesses with fewer than 25 employees would not have to contribute.  Benefits will be based on the eligible employee’s average weekly wage.

Rhode Island
As of July 1, 2019, the Rhode Island Temporary Disability Insurance (TDI) maximum weekly benefit has increased to $867.00 with the dependent allowance increasing to $1,170.00 (for 5 dependents).   

Washington
The reporting deadline for quarters one and two has been extended from July 31, 2019 to August 31, 2019 to ensure employers have enough time to set up their account, file and pay for both quarters.  For more information, please refer to the Washington Paid Family & Medical Leave website reporting page: https://www.paidleave.wa.gov/reporting.

State Leave Laws Updates & Reminders

California State Disability Insurance Fund Forecast for 2020

The California Employment Development Department (EDD) has released its May forecast for the 2020 Disability Insurance (DI) Fund.  The DI fund provides State Disability Insurance (SDI) and Paid Family Leave benefits for California employees.  The 2020 employee contribution rate is expected to increase from 1.0% to 1.1%; the maximum weekly benefit is expected to increase from $1,252 to $1,327; and the taxable wage base, from which DI contributions are taken, is expected to increase from $118,371 to $125,462. The final 2020 DI Fund forecast is expected to be published in late October. 

California employers may opt out of the state plan if a private plan, Voluntary Disability Insurance (VDI), is established and certain requirements are met.  Two of these requirements are that the employee cost of VDI cannot be more than what the employee would pay for SDI and the benefits paid by VDI must be at least equal to what SDI would pay.  For more information about VDI, please contact The Larkin Company.

The Larkin Company will reach out to clients for whom we administer VDI to assist them in planning for 2020. 

The Larkin Company Newsletter

State Laws Update: New Jersey & Washington

New Jersey

New Jersey has approved expansions to its Family Leave program, with enhancements starting this year and in 2020. Effective February 19, 2019, the definition of “family member” under the Family Leave Act (FLA) and for claims beginning on or after February 19^th under Family Leave Insurance (FLI) was expanded to include caring for children of any age, domestic partners, siblings, grandparents, grandchildren, parents-in-law and anyone else related by blood or who is the “equivalent” of family. Also, foster parents and parents of a child born using a surrogate now may claim FLI benefits while bonding with the child. The seven-day waiting period for FLI benefits has also been eliminated.

Effective February 19, 2019, employees are allowed to take up to 12 weeks of reduced schedule leave over a period of 12 consecutive months.  Previously, employees were allowed to take 12 weeks of reduced schedule leave, but not beyond 24 consecutive weeks.  Beginning June 30^th of this year, protected leave requirements under FLA will be applicable to more employees working in the state, as the threshold for businesses will decrease from 50 or more employees to 30 or more employees.

Beginning January 1, 2020 employee contributions will increase due to the increase in taxable wages. It is estimated that some employees will pay up to $100 annually.  Starting in July 2020, Employees will be eligible for up to 85% of their average weekly wage (AWW), to approximately $860 a week. In addition to this weekly benefit increase, employees will be entitled to claim up to 12 consecutive weeks of paid family leave benefits (presently only 6 weeks are allowed). New Jersey will also enhance its intermittent and reduced schedules offered under the law beginning July 2020. Eligible employees will be able to take intermittent leave for up to 56 days (presently 42 days per year).

Washington

The Washington Paid Family and Medical Leave (WAPFML) program’s benefits will soon begin. Premium collections from employees were allowed effective January 1, 2019. Employers that intend to withhold the employee portion but have yet to start collections can begin withholdings at any time provided they give employees at least one pay period’s notice. Premium withholdings cannot be withheld retroactively, and any missed collections must be paid by the employer, but there is no penalty for starting collections after January 1^st.

The first reporting and remitting due date has been pushed back to July 31^st. For 2019 only, the first and second quarter’s reporting and contributions will be submitted in the month of July. Starting July 1^st, employers or their authorized agents will file quarterly reports by logging onto the WAPFML customer management system portal. Employers can submit the information to the portal either by manually entering their employees’ data or submitting a CSV file. Additionally, bulk filing will be available for those agencies that are reporting for more than one employer.

For more information, and an updated employer toolkit guide, visit the WAPFML Employer page.

Updates on State Laws

New Jersey
New Jersey Governor Phil Murphy has signed three new bills into law that will provide greater benefits for New Jersey employees. These new laws will take effect October 4, 2019. In addition to the new laws, the New Jersey Department of Labor and Workforce Development has approved new rates for Temporary Disability benefits (TDI) and the Family Leave Insurance program (FLI). Details on the recently passed bills and rate changes are as follows:

NJ Assembly Bill 2762 provides that when an employee applies for pregnancy or birth-related disability benefits under TDI, the plan must automatically also process an application for FLI unless the individual opts out. The FLI benefits, if approved, would begin immediately following the end of the TDI benefits.

NJ Assembly Bill 2763 expands the data that the Commissioner of Labor must provide in annual reports and requires the reports to be made available to the public.

NJ Assembly Bill 4118 allows individuals to submit TDI and FLI claims up to 60 days before the start of a leave in certain circumstances. The provisions will apply only to disability and family leave claims beginning on or after January 1, 2019.

Rate Changes: The Department has approved that the maximum weekly benefit increases from $637to $650; the base week amount an employee must earn increases from $169 to$172, and the maximum wage ceiling for employee contributions increases from $33,700 to $34,400. These new rates will take effect January 1, 2019. 
 
New York
Governor Cuomo signed Senate Bill 2496, also known as the Living Donor Protection Act, into law on November 5, 2018. The law will amend New York Paid Family Leave’s definition of “Serious Health Condition” to include “transplantation preparation and recovery from surgery related to organ or tissue donation”. The new law,which is aligned with the serious health condition definition under the Family and Medical Leave Act, will allow eligible employee to take leave to take care for a family member who is preparing or recovering from transplant donations.The law is slated to take effect starting February 3, 2019.

Washington
The Washington State Employment Security Department (ESD) has published an updated employer toolkit designed to guide employers as the new Washington State Paid Family and Medical Leave (WA PFL) law is set to kick off with premium deductions for the new program beginning January 1,2019. The toolkit focuses on employer responsibilities and touches on several topics, including an overview of the law and benefits as well as premium and reporting requirements. As the program’s elements are still in development and rulemaking is still in progress, the ESD will continue to publish periodic updates to the toolkit. We encourage employers to visit www.paidleave.wa.gov for the most up-to-date information. In addition, The Larkin Company will continue to keep you updated as new information comes in.

California EDD Announces 2019 Changes to State Disability Insurance

The California Employment Development Department (EDD) has announced that the 2019 employee contribution rate for State Disability Insurance (SDI) will remain at 1.0%.  The taxable wage base from which the contributions will be taken will increase from $114,967 to $118,371 and the maximum cost to an employee will be $1,183.71.

SDI provides disability and Paid Family Leave (PFL) benefits equal to 60%* of the employee’s base period earnings.  For 2019, the maximum weekly benefit will increase from $1,216 to $1,252.

California permits employers to opt out of SDI and establish a private plan for Voluntary Disability Insurance (known as a “Voluntary Plan”), provided certain requirements are met.  Among these requirements are that the Voluntary Plan’s cost to employees be no more than the cost for SDI and that benefits paid by the plan are at least equal to what SDI would pay.

The Larkin Company is reaching out to clients for whom we administer a Voluntary Plan to assist them in planning for 2019.

*SDI will provide disability and PFL benefits equal to 70% for employees with an annual income less than ~$21,541 (1/3 of the State Average Weekly Wage).

Must an Employer Offer Leave as an Accommodation?

On September 20, 2017 the Seventh Circuit upheld a decision from a lower district court in Severson v. Heartland Woodcraft, Inc that an employer did not violate the American with Disabilities Act (ADA) by failing to provide an employee with a long term medical leave of absence.  In the Severson case, employee Severson took twelve weeks of Family and Medical Leave (FMLA) due to severe back pain.  Prior to the end of the FMLA leave, Severson let his employer know he required surgery and requested an additional two to three months of leave.  The employer, Heartland, denied the request and terminated Severson.  Heartland invited Severson to reapply when he was medically cleared to work.  Severson did not reapply and instead sued Heartland for discrimination under the ADA for failing to provide him with “leave as a reasonable accommodation.”  The Seventh Circuit affirmed the lower court’s ruling stating, “If the proposed accommodation does not make it possible for the employee to perform his job, then the employee is not a ‘qualified individual’ as that term is defined in the ADA.”

In response to the Seventh Circuit decision, the EEOC filed a brief as amicus curiae supporting the reversal of the Seventh Circuit decision.  In the brief, the EEOC asserts, “When an employee requests a temporary leave of absence as a reasonable accommodation, the employee’s ability to perform the essential functions should be assessed as of the projected end of the leave period.”

As the EEOC opposes the Seventh Circuit decision, employers should continue to evaluate accommodation requests on a case by case basis. With every evaluation, it is important to engage in the interactive discussion process with the employee, and document the interactive process.  The Larkin Company is currently beta testing ADA services that we plan to offer all clients in addition to our current services.  Our ADA program is designed for Larkin to engage in and document the interactive process on behalf of our clients.

The United States Court of Appeals for the Seventh Circuit is located in Chicago, Illinois and has jurisdiction over the Central District of Illinois, Northern District of Illinois, Southern District of Illinois, Northern District of Indiana, Southern District of Indiana, Eastern District of Wisconsin and the Western District of Wisconsin.

The Larkin Company is here to help.  Please contact us and we will schedule a time to review your plans and policies.

New York State Paid Family Leave Taxation Update

New York has released Notice N-17-12 which provides guidance regarding taxation of the Paid Family Leave Program beginning January 1, 2018.

• Benefits will be taxable non-wage income and must be included in federal gross income.
• Employees must request voluntary tax withholding as the taxes will not automatically be withheld.
• Employers should deduct premiums from employees’ after-tax wages.
• Employers should report employee contributions on Form W-2, Box 14.
• Benefits should be reported on Form 1099-G by the State Insurance Fund and on Form 1099-MISC by all other carriers.

The guidance for New York Paid Family Leave benefits is limited to Notice N-17-12.  It is recommended that employers seek further guidance from a tax or employment counselor.  Employee contributions may begin as early as July 1, 2017.  Employers will want to reach out to their NY DBL/PFL carrier to determine the contribution schedule that best fits their PFL policy.

Beginning January 1, 2018, New York employees may take job-protected, paid leave to bond with a new child, care for a seriously ill family member, or to take leave for a qualifying military exigency. New York Paid Family Leave will be phased in over four years beginning with 8 weeks of paid leave in 2018.
Please see our July newsletter for additional information regarding New York Paid Family Leave.

The Larkin Company is here to help.  Please contact us and we will schedule a time to review your plans and policies.

Updates on State Laws: New York, Nevada, and Washington

New York State Paid Family Leave Finalized

On July 19, New York Governor Cuomo announced the final regulations implementing the New York Paid Family Leave Program (NYPFL).  NYPFL will provide income replacement, job protection, and continuation of insurance for employees who take leave to bond with a new child, care for a seriously ill family member or assist when a family member is deployed on active military duty.  Private employers will need to obtain Paid Family Leave coverage for their employees effective January 1, 2018.
New York PFL provides a 50% weekly benefit for up to 8 weeks of leave beginning in 2018 and will gradually phase in increases to the benefit and duration to cap at a 67% weekly benefit up to 12 weeks in 2021.
What should employers with New York employees do now?

• Employers should reach out to their New York Disability Benefits (NYDBL) carrier to obtain Paid Family Leave coverage.
• Include New York Paid Family Leave information in the employee handbook or equivalent employee materials.
• Display a poster regarding New York Paid Family Leave coverage in your place of business.  This poster will be available from your insurance carrier.

A fact sheet from the New York Workers’ Compensation Board is available here: https://www.ny.gov/sites/ny.gov/files/atoms/files/PFL_Employer_Fact_Sheet.pdf

Nevada Pregnant Workers’ Fairness Act

On June 2, Nevada Governor, Brian Sandoval, signed SB 253, the Nevada Pregnant Workers’ Fairness Act into law expanding the protections for pregnant employees.  The Act requires employers to provide reasonable accommodations to female employees or applicants due to pregnancy, childbirth, or a related medical condition.  The Act also makes it unlawful for employers to take adverse action against an employee due to the request and or use of an accommodation.  Nevada employers with 15 or more employees must comply with the new Nevada Pregnant Workers’ Fairness Act which goes into effect October 1, 2017.  Notice requirements which went into effect in June of 2017, require a general notice be posted in the work place.  The Act also requires employers to notify employees of their rights upon commencement of employment and within 10 days of an announcement of pregnancy.

Washington State Becomes the 5^th State to Pass Paid Leave

On July 5, 2017, Washington joined Puerto Rico, Rhode Island, New Jersey, New York, Hawaii and California as Governor, Jay Inslee, signed SB 5975 into law.  The Washington law will provide 12 weeks of paid leave for purposes of bonding with a new child, caring for a seriously ill family member, military exigency, and for an employee’s own serious health condition.  Two extra weeks are allowed for pregnancy complications.  The program goes into effect January 1, 2020 and will be funded by employee contributions.  Employers may deduct the premiums beginning January 1, 2019. Washington State previously passed a paid family leave law in 2007 but due to the recession the program was never funded.

The Larkin Company is here to help.  Please contact us and we will schedule a time to review your plans and policies.