New York State’s Paid Family Leave Act (PFL) is one of the strongest family leave laws in the United States. It covers most workers in the private sector, including part-time workers.
Who Is Covered For PFL?
Employees who work full-time for private employers in New York State are eligible for PFL as long as they’ve worked 20 or more hours per week for 26 consecutive weeks. If a part-timer works fewer than 20 hours per week, he’s eligible for PFL after working 175 days which don’t need to be consecutive days.
So who’s not covered? Well, it’s reasonably likely that seasonal employees – people who don’t work at least one-half year’s worth of weeks (26 weeks) in a row – are not covered by the law. Employers that have a primarily seasonal workforce, then, likely will not be affected by the change in the law.
Eligible Employees Can Use PFL in Three Types of Circumstances.
First, employees can use PFL to bond with their child within the first year of birth, adoption, or foster care. Parents working for different employers can use PFL at the same time. Parents working for the same employer also can use PFL at same time as long as their employer lets them, but it’s not mandatory to permit this. It’s important to note that expectant mothers cannot use PFL.
Second, employees can use PFL to care for a family member with a serious health condition. A serious health condition is defined as an “illness, injury, impairment, or physical or mental health condition requiring either inpatient care, or continuing treatment or supervision by a healthcare provider.” Employees can take off work to care for their spouse, domestic partner, child, stepchild, parent, parent-in-law, step-parent, grandparent, or grandchild. And notably, COVID-19 quarantine leave is available when an employee or his minor, dependent child must complete mandatory or precautionary quarantine or isolation.
Third, employees can use PFL during a family member’s military deployment. This can include short notice military deployment, military events (like official ceremonies or informational briefings related to active duty), a service member’s rest and recuperation, counseling, post-deployment activities, and making financial or legal arrangements.
Employees who use PFL can receive up to 12 weeks off work. And they can be paid 67% of their average weekly wage, capped at 67% of the State’s average weekly wage. Employees can use PFL in shorter bursts of time, but they must take the time off in full-day increments.
Clarifying The Notice Requirements for PFL
While life is unpredictable and situations may arise that can’t be planned for, New York’s Paid Family Leave (PFL) law requires that employees be proactive. If an employee wants to take PFL that’s foreseeable, they’re required to give their employer at least 30 days’ advance notice. After informing his employer, an employee should complete the appropriate request forms which then are sent to the employer’s PFL insurance carrier.
Foreseeable qualifying events include situations such as an expected birth, placement for adoption or foster care, a family member’s planned medical treatment, planned medical treatment for a serious injury or illness of a covered service member, or another known military exigency.
Employers may deny PFL for up to 30 days if the employee knows about the underlying circumstance necessitating PFL but doesn’t provide timely notice to the employer.
On the other hand, if 30 days’ advance notice isn’t possible due to an employee’s not knowing when his leave will be needed or because an emergency arises, the law still requires him to provide notice as soon as possible and practical. What’s possible and practical depends on the facts and circumstances surrounding the event.
When revising employment policies to account for the January 1st effective date for PFL, make sure your employees know you’ll require them to plan ahead and give adequate notice or they may be denied PFL, at least for some length of time.
Exceptions To The Rule
While PFL has broad applicability, the law contains exceptions, and employers are well-advised to review, understand and ultimately incorporate these exceptions into their policies.
For example, employers won’t be required to provide PFL for:
- Two employees who request leave to care for the same person during the same time period;
- Employees on administrative leave;
- Employees already collecting PTO at the time of the requested leave;
- Employees already collecting disability benefits for the time period that PFL leave is requested.
- Employees who are seasonal or otherwise haven’t worked the required 26 weeks (or 175 days) immediately before their PFL request.
The proposed regulations add two additional exceptions:
- Pregnant employees. PFL will not apply to women until after their child is born;
- Employees who opt out and waive making contributions to the cost of FML.
The New York Department of Labor hasn’t yet provided concrete information on when the PFL regulations will become final or whether implementation will be delayed so these last two exceptions are subject to change.
Finally, while it probably goes without saying, PFL doesn’t apply to independent contractors. An independent contractor isn’t a W-2 employee.
What’s a Serious Health Condition?
How do employers determine whether an employee is eligible for New York’s Paid Family Leave (PFL) on account of a so-called serious health condition?
Just because a family member’s illness seems serious to an employee doesn’t mean the illness qualifies for PFL. That’s because PFL defines a serious health condition as an illness, injury, impairment, or physical or mental condition that requires hospitalization, hospice care, or a stay in residential health care facility. Some other conditions likely will qualify as a serious health condition if they require continuing treatment or supervision by a health care provider.
Several factors determine whether a condition requires such continuing treatment or supervision. Generally, a condition qualifies if it causes the person to miss work or school or otherwise be unable to perform regular daily activities for more than 3 full days in a row, and the person undergoes a continuing treatment regimen or receives multiple treatments for the condition.
These requirements differ for serious health conditions that are chronic; however, as a chronic serious health condition requires periodic treatment over an extended period of time and has the potential to cause episodes of incapacity.
In short, not all illnesses qualify as a serious health condition. It comes as no surprise, then, that an employee can’t take a PFL day every time his child stays home from school with a cold or his spouse misses work because she has the flu.
Your PFL insurance carrier will decide whether your employee’s request qualifies for PFL. But to avoid employee frustration and needless requests for leave, it’s a good idea to educate employees about what types of illnesses and conditions qualify. Setting expectations early can help reduce frustration later and make for a more productive workforce.
PFL Rates
On June 1, 2017, the Insurance Department issued its final regulations on the Paid Family Leave law which is scheduled to become effective January 1, 2018. Regulations by an agency are a common way for a statute to be implemented. Stated differently, regulations provide the details we need in order to know how to comply with laws.
One important aspect we’ve been waiting for is how much will this benefit cost? This is an expense that’s appropriate to pass along to employees via payroll deduction.
We now know the answer. The rate is based on a percentage of an employee’s compensation and is set at 0.126% of the weekly wage. Total cost is capped by reference to New York State’s current average weekly wage which is $1,305.92. So it becomes a simple math problem: at most the cost per employee will be $1,305.92 x 0.126%.
Practical Pointer: This translates into a maximum employee contribution of $1.65 per week.
Taxes
In consultation with the IRS, the New York Tax Department advises employers that:
- Benefits paid to employees will be taxable non-wage income that must be included in federal gross income;
- Taxes will not automatically be withheld from benefits, but employees can request voluntary tax withholding;
- Premiums should be deducted from employees’ after-tax wages;
- Employers must report employee contributions on Form W-2 using Box 14 which is for State disability insurance taxes withheld; and
- Benefits paid to an employee should be reported by the State Insurance Fund on Form 1099-G and by all other payers (including self-insured employers) on Form 1099-MISC.
As expected, the State Tax Department reminded employers that its publication is only advisory and that employers have a continuing obligation to work with their own consultants and tax advisors in order to comply with the law.
This advisory from the Tax Department reminds us that PFL’s reach is wide and it’s up to each employer to ensure that its policies and procedures adhere to the law, which became effective January 1, 2018.
Reach Out To Experienced NY Attorneys
Feel free to reach out to the experienced attorneys here at The Coppola Firm with any questions related to New York’s Paid Family Leave law. We’re here to help!
