New York State’s Paid Family Leave Law: Understanding Employer Requirements

By January 13, 2017FMLA, New York

Background of the Family Leave Law

On April 4, 2016 New York Governor Andrew Cuomo signed into law a new Family Leave Law that is the highest and longest paid family leave in the country. The new family leave law starts in 2018 and will phase in 12 weeks of paid leave for employees. It is vital that employers in New York State understand and prepare for the new law before it goes into effect. The new law encompasses parts of the Family Medical Leave Act (FMLA) but changes other requirements of FMLA and creates new guidelines. Additionally it incorporates definitions and processes found in other state’s sick leave laws, yet doesn’t provide for sick leave. Employers, especially those with multiple locations face fines and penalties for non-compliance. The purpose of this article is to highlight the basic features of the law and what human resource managers and payroll departments need to understand regarding the new law.

New York’s Paid Family Leave Benefit Law (PFLBL) will provide 12 weeks of paid benefit to employees who need to take a leave of employment due to family issues. The new law will phase in over several years, starting in 2018. Eligible employees are paid by a state funded insurance, which will be deducted from employees wages as an estimated 1% deduction. Although, currently no insurance carriers have been quoted and this is solely an estimate by the governor. Other experts estimate that employee deductions could be as high as five times that amount. The State’s Superintendent of Financial Services has the duty to set the actual rates each year based on the current cost of funding the program.  

Phases of the Family Leave Act

The new Family Leave Benefits Act phases in over a four year period starting January 1, 2018.

  1. January 1, 2018 employees may receive up to eight weeks of paid benefits in a 52 week period at 50% of their average weekly wage. That amount cannot exceed 50% of the New York State Average Weekly Wage (NYSAWW).
  2. January 1, 2019 employees may receive up to 10 weeks of paid benefits in a 52 week period at 55% of their average weekly rate. That amount cannot exceed 55% of the NYSAWW.
  3. January 1, 2020 employees may receive up to 10 weeks in any 52 week period at  60% of their average weekly rate and it cannot exceed 60% of the NYSAWW
  4. January 1, 2021 employees may receive up to 12 weeks in any 52 week period at 67% of their average weekly rate. That amount cannot exceed 67% of the NYSAWW.

The Paid Family Leave Act allows the Superintendent of Financial Services to delay the phasing in of the act based on several factors in a declining economy. Those factors include the current cost to employees of the act, the availability of insurance policies to provide the benefits, and the impact of the benefit increases to employers businesses.

Currently the New York Average Weekly Rate equates to $67,000. That means that employees who make more than this amount will be paying into the fund at a higher dollar amount and yet will still be ineligible to receive the same percentage of their wages as lower income workers.

Who qualifies for Paid Family Leave

Every employee who has worked for the same employer in New York State for at least 26 weeks will be eligible for paid family leave upon a qualifying event. Employers must have worked for the a consecutive 26 weeks, which is half of the 12 months that FMLA requires. Further, while FMLA requires that the employees have worked 1,250 in the last 12 months, New York’s Family Leave Act has no minimum hourly requirements to be eligible for the paid leave. Further,  PFLBL is available to employees regardless of the size of their employers. That means that large and small employers alike are obligated to provide this benefit to employees. That is also different from FMLA, which recognizes the strain and financial burden an employee’s absence for 12 weeks can put on small employers. FMLA only requires employers with 50 or more employees to provide FMLA to their employees.

Requirements of PFLBL

New York’s Paid Family Leave Act protects employees who take leave from losing their jobs and requires employers to reinstate employees back to the same or a similar job upon returning to work. This means that employers must burden the cost of displacing the employee’s workload for 12 weeks or must hire temporary help. For small businesses, this can be a financial drain as they hire temporary workers and have to shoulder the cost of training them so that the position can still be available upon the employee’s return. If a business has 5 employees and one of them leaves for 12 weeks, that can significantly impact the business and its ability to function.

Eligible Purposes for taking Paid Family Leave

Employees can take family leave for the first year after having a child or having a child placed with them through adoption or foster care. This is to provide time for the employee to bond with the new child. Additionally, employees can take paid leave to help with a family member’s serious health condition and to provide medical care and assistance. Lastly, if a spouse is called into Active Duty with the military, the employee can take paid time off to assist with the needs and family obligation due to the call to Active Duty. However, Paid Family Leave is not available to employees to care or receive medical help for their own health condition or illness.

  • To bond with a child in the first 12 months after the child’s birth
  • To bond with a child placed with the employee through foster care or adoption during the first 12 months after placement.
  • To provide care for a family member because of the family member’s serious health condition.
  • To assist with family obligations when a family  member is called into Active Duty with the Military

Both the Paid Family Leave Act and FMLA allow for the reasons stated, but FMLA also allows for an unpaid leave for the employee’s own health issues or condition  Further, FMLA expands the definition of circumstances beyond a family member being called into Active Service. FMLA also allows for leave to care for a family member who is a member of the United States Armed Services, or when two spouses employed by the same employer, are both called into Active Service. The New York Paid Family Leave Benefits Act does not address these additional scenarios.  

Minimum amounts of Leave available

Paid Family Leave can be taken intermittently during a 52 month period. It can also be taken for less than a full week. Unlike FMLA, which allows employers to require some Paid Time Off (PTO) to be used to start FMLA, New York’s Paid Family Leave does not require employees to use PTO before starting Family Leave.

Using Paid Family Leave and coordinating with other leaves

The PFLBL allows for employers to provide flexibility in providing paid time off and family leave. However, there are several key factors for an employee to receive paid family leave, specifically:

  1. No employee may have over 12 weeks of leave in a 52 week period. This includes employees who combine paid family leave with disability benefits that exceeds 26 weeks in a 52 week period.
  2. Prior to receiving leave, the employee must file a notice to the employer and a medical certification, in a form, generated by the Chairman of the Workers Compensation Board. If employees fail to file this form, they will not be eligible to receive benefits.
  3. Employers can require an employee to choose between taking accrued and unused time off at full pay or to take Family Leave at reduced benefits when taking leave. Unlike FMLA, PFLBL doesn’t allow employers to compel employees to take accrued time off when taking family leave. Employees are allowed to reinstatement to the same or a similar position upon returning to work.
  4. Employees must use FMLA and PFLBL concurrently. They cannot stack the leaves for a longer leave.
  5. Employees cannot concurrently receive both Paid Family Leave benefits and New York State Disability Benefits.
  6. When the need for family leave is foreseeable, employees must provide their employers with a 30 day notice of leave. If the leave is unforeseeable, then employees must notify their employers as soon as possible.

Ineligible employees for Family Leave Benefits

New York’s Paid Family Leave Act does specify specific instances when an individual would not be eligible for paid family leave. The exceptions are few and very specific. Most employees who have been at the same employer for 6 months will be eligible for paid family leave. The exceptions include employees who are receiving full time disability benefits, employees who is on an administrative leave from their employment, receiving sick paid time off, or who works on the same day as the family leave is claimed. The main purpose of the restrictions is to prevent a duplication of paid benefits for employees.

  • Employees who are receiving full time disability pay under workers compensation, volunteer firefighters or ambulance workers benefits. If an employee is receiving partial disability, they can still be eligible for paid family leave, but the total amount of benefits cannot exceed the worker’s average weekly pay.
  • Employees who are on administrative leave from their employers.
  • Employees receiving sick pay or paid time off from an employer.
  • For any day that the claimant works part of the day during the same working hours as those claimed for the paid family leave.

Employment Benefits must be maintained during leave

PFLBL states that all benefits available to the employee must be retained during the leave. This means that employers must continue to pay for employee benefits, such as health insurance, during the employee’s absence.  Employers must continue to pay premiums to group policies while the employee is taking leave. It is unclear at this point if employers will be entitled to recover premiums from employees who choose not to return to work after the leave is over, as is allowed under FMLA.

Retaliation

Both the Act and FMLA prohibit employers from retaliating against an employee who seeks to use or receives benefits under the act.

Non-Compliance with the Family Leave Law

Employers must post notice of the new law in a conspicuous place where all employees can be advised of their rights under the law. Additionally, any employee who takes leave, of 8 days or more, under the law must be notified in writing of their rights. Employers who fail to give proper notice to their employees or who fail to comply with any aspect of the law are subject to fines and guilty of a misdemeanor. Employers will be subject to fines and imprisonment. Penalties can range from $100 to $2,000 for each violation.

What Employers need to do now to prepare for the new Family Leave Act

Paid Family Leave doesn’t start for a year and, even then, isn’t fully phased into effect. However, it is vital that employers take the time now to educate managers and human resource personnel on the new law. FMLA, which has been around for over 20 years is still often administered incorrectly. Therefore it is likely that as the new Family Leave Act phases in that businesses will not fully understand the law and managers may violate aspects of the law. This would result in penalties and fines for businesses. Further, businesses should anticipate the additional administrative costs of the act and plan in their budgets accordingly. Small and Medium sized business should anticipate the effect that employee leave will have on the business and plan accordingly. For many small businesses, that may mean more cross training and additional budget planning for training and hiring temporary help. This is especially impactful if the leave is taken intermittently. Businesses who fail to plan for the new act may find themselves paying costly and unexpected consequences.

Written by Annemaria Duran. Last updated January 13, 2017