Our last few posts have discussed how a New York employer can determine if an employee is entitled to leave under New York’s Paid Family Leave (PFL) law. Once you determine an employee is eligible for PFL, you may be wondering what to do about the benefits that she’s receiving.
Are you required to keep an employee on your company’s benefit package during leave? Who pays for this?
PFL requires you to maintain an employee’s health insurance as if she were still working. This means if you were making contributions towards that employee’s health insurance before she took leave, you must make the same contributions while she’s on leave. Just the same, if the employee were making contributions towards her health insurance before her leave, she must continue making contributions towards the cost of her health insurance while on leave.
It’s key that you treat an employee on leave as though she were still working. For example, you must continue to provide the employee on leave with notice of any opportunities to change plans or benefits. This also means that if the cost of health insurance premiums changes while the employee is on leave, both your contributions and the employee’s contributions should increase or decrease as they would if the employee were still showing up to work each day.
What happens if the employee stops paying her share of the contributions?
If an employee is more than 30 days late on payments for her health insurance premiums, you generally no longer are obligated to contribute towards the plan. To drop health insurance coverage for that employee, you must provide her with written notice that her payment has not been received. This notice must specify the date her coverage will end if payment is not received and must be mailed to the employee 15 days before that date.
If an employee’s health insurance lapses during her unpaid leave for any reason, you must restore the employee to the same or equivalent benefits when she returns to work. This is true even if the employee chooses to not retain the health insurance coverage during her leave.
These practices are consistent with the obligations you may have if your company complies with federal FMLA. If you’re unfamiliar with these obligations, we’re happy to assist you.