Vermont is implementing a new paid family and medical leave insurance (PFMLI) program. The program will be similar to New Hampshire’s Paid Family and Medical Leave program (NH PFML) in that the Vermont PFMLI will be automatically available to state employees at no cost. Private employers on the other hand won’t be automatically enrolled into the program, but can instead choose to opt-in to the program, should they wish. Further, the Vermont PFMLI program allows employees themselves to opt-into the program, as individual participants (also like New Hampshire’s program). If employers or individual employees enroll into the program, employers will collect employee PFMLI premiums on behalf of the employee and remit them to the VT PFMLI plan. The specific premium rate is to be determined.

The VT PFMLI program and its benefits will be administered by a third-party insurance company, The Hartford. Many of the key details concerning the program are to be determined. However, the benefits provided under the program are initially expected to be as follows:

• 6 weeks of leave benefits provided within in a 12-month period. The leave reasons will include, parental, medical, family care, and military exigency leave.
• As of July 1, 2023, the program will be available for state employees; by July 1, 2024, the program will be available for private and non-state public employers on a voluntary basis; and by July 1, 2025, the program will be available to small employers, and eligible, individual employees.
• An employee on leave is eligible to receive 60% of their regular weekly base pay. The maximum weekly benefit is based on the Social Security Taxable Wage Maximum(Social Security Taxable Wage Maximum/52 weeks x 60%). Using the current 2022 Social Security Taxable Wage Maximum $147,000, as an example, employees would be eligible to receive $1,696.15 per week if the program were live in 2022. There is expected to be a 1 week waiting period for medical claims. Family leave claims (e.g. parental, family care, exigency claims), however, will be payable from day one of the leave.
• PFMLI claims will be payable for intermittent and reduced schedule claims, provided that the combined total of earned wages and claim payments does not exceed 100% of an employee’s weekly pay.
• It is anticipated that employees will not be able to request to take PTO and claim PFMLI benefits at the same time. As the state puts it, “An employee will not receive both FMLI and paid time off if for the same hours.”

It is unclear if PFMLI will run concurrently with the federal Family and Medical Leave Act (FMLA) and the unpaid Vermont Parental and Family Leave Act (VPFLA) at this time. It is our expectation that these laws will run concurrently, but we will continue to monitor this topic as the state provides more guidance.

In the case of an employee receiving state benefits in another state while on medical leave, Short Term Disability (STD) is typically the “secondary insurance benefit” to state benefits, i.e. STD in most states will top-up any benefits an employee is receiving from the state. However, the VT PFMLI program appears to be different, based on the information currently available. Vermont describes the VT PFMLI program itself as the “secondary benefit” source. This would suggest that STD benefits will not be able to offset by VT state benefits. In general, we will continue to follow VT PFMLI as more information is released and keep our clients posted about this program.

The Hartford VT PFMLI Website