Private employers in New York will need to be ready to provide paid family leave to eligible employees as of January 1, 2018. However, by July 1, 2017, employers may start withholding from employee paychecks to fund the program.
As a brief background, the New York Paid Family Leave Law (NYPFL) is effective January 1, 2018, and has been touted as the nation’s most comprehensive paid family leave program. The NYPFL provides for a phased schedule of paid leave entitlement for employees that need to take time off to:
- bond with their child during the first 12 months after the child’s birth, adoption or foster care placement:
- assist a “close relative” with a serious health condition such as inpatient care, outpatient chemotherapy or at-home recuperation from surgery; or
- for reasons outlined in the federal Family and Medical Leave Act (“FMLA”) with regards to assisting a family member called to active military service.
Close relatives include spouses, domestic partners, children, parents, parents-in-law, grandparents and grandchildren. Notably, employees are not entitled to use NYPFL for their own serious medical condition since they can apply for state- or employer-provided short-term disability benefits. Employees are also not entitled to use NYPFL for their own military service.
Why is July 1, 2017 significant?
While private employers are required to carry a disability policy covering paid family leave, or self-insure, the NYPFL is intended to be fully funded by employee payroll deductions rather than contributions paid by employers. Employers are permitted to begin the payroll deductions as of July 1, 2017 to allow for ramp up time to fund the NYPFL benefits. The maximum employee contribution shall be 0.126 percent of an employee’s weekly wage, and is not to exceed the statewide average weekly wage (SAWW) as established by the New York State Department of Labor. The SAWW is currently $1,305.92, so the maximum NYPFL payroll deduction will be capped at $1.65 per week. The employee contribution is predicted to increase each year as the SAWW is reset annually on March 31.
Notably, the NYPFL regulations do not address whether an employer can decide not to take payroll deductions for employee contributions if the employer chooses to make the payments for its employees.
What Employers Are Covered?
Coverage is extremely broad – any New York employer that has employed at least 1 employee for 30 days in any calendar year is covered.
Who Is Eligible?
Both full-time and part-time employees are eligible. An employee who has worked for 20 or more hours per week for 26 or more consecutive weeks (6 months) is eligible. An employee who has worked less than 20 hours per week for 175 days in a 42-consecutive-week period is also eligible. The NYPFL benefit is also available to foreign and undocumented workers. Independent contractors, farm laborers and other types of workers are not eligible for NYPFL benefits.
Employees who are not eligible may have the option to file a waiver of NYPFL benefits which exempt the employee from the applicable payroll deductions.
How Much Leave is Available – What is the Benefit?
The New York State government website provides the following chart of how the leave entitlement will be phased in over the next four years.
|
Year |
Weeks Available |
Max % of Employee Average Weekly Wage |
Cap % of State Average Weekly Wage |
|
1/1/2018 |
8 |
50% |
50% |
|
1/1/2019 |
10 |
55% |
55% |
|
1/1/2020 |
10 |
60% |
60% |
|
1/1/2021 |
12 |
67% |
67% |
NYPFL is only available in full-day increments, but employees can take the time as intermittent leave. Employees are not allowed to “stack” leave requests for different qualifying reasons under the NYPFL once they reach their annual maximum benefit. The NYPFL also requires that employees be reinstated to their position or a comparable position upon return from the leave. The statute prohibits retaliation against any employee for seeking or receiving benefits provided by the NYPFL.
What is the Process for a NYPFL Request?
As with the FMLA, employees must provide no less than 30 days’ notice if the need for leave is foreseeable. If not, notice must be provided as soon as practicable. New York will publish a “Request for Paid Family Leave and Certification” form, but employers can use another form. The employer should adopt a policy directing the employee what and where to file a request for benefits. Unless the employer is self-insured, the form should be directed to the applicable insurance carrier. The employer will also be required to provide information to process the request. NYPFL leave can be denied if the employee does not submit a completed medical certification.
If an employee is eligible for both FMLA and NYPFL, the employer should designate the leave as both FMLA and NYPFL even if the employee declines to apply for NYPFL.
Can Employees Supplement NYPFL with PTO?
An employer may require an employee to choose whether to use NYPFL or their accrued paid vacation, sick or Paid Time Off (collectively PTO) so they can receive their full salary while on leave. Employers can also allow employees to supplement NYPFL pay with PTO. It does not appear that employers are allowed to require employees to use their available PTO before using NYPFL benefits. Employers that pay full salary during a period of NYPFL may request reimbursement from the insurance carrier for advance payment of benefits to avoid “double-dipping” by the employee.
Employers that already offer paid family leave benefits that exceed those offered by the NYPFL will be deemed as satisfying the law’s requirements. In other words, an employee is not entitled to “add-on” NYPFL benefits to an existing, more generous paid family leave policy.
What is the Interplay with Other Leave Laws?
FMLA: First, the NYPFL will apply to employers that are not subject to the FMLA since FMLA is not triggered until the employer has 50 or more employees. The NYPFL also does not have the FMLA requirement that an employee work for at least 1,250 hours within the previous 12-month period to be eligible for leave. Second, FMLA and NYPFL leave can be taken concurrently. Third, the NYPFL adopts the FMLA prohibition on reducing employment benefits because the employee is taking leave, and the requirement that employers must maintain an employee’s existing health insurance benefits for the duration of leave.
Workers’ Compensation: Employees may not use NYPFL while they are collecting WC benefits and not working.
What About Union Employees?
Employees may not be eligible for NYPFL if subject to a collective bargaining agreement (CBA) that provides benefits and protections at least as favorable as provided under the NYPFL. In certain situations, the CBA may provide rules related to paid family leave that differ from the NYPFL regulations.
What Should Employers Do Now?
- Work with Payroll vendors or internal processors to be sure that the deduction for NYPFL is implemented.
- Supplement existing STD policies to provide coverage for NYPFL, or take measures to put self-insurance in place, by January 1, 2018.
- Update handbooks, STD, FMLA and PTO policies to include paid family leave coverage in the policy consistent with the obligations under the NYPFL.
- Review CBAs covering NY employees.
- Train HR and others to properly track time off to demonstrate compliance with the NYPFL.
- Be prepared to post the required NYPFL notice by January 1, 2018. New York has also launched a helpline and website to provide employees and employers with information about the NYPFL.
The material contained in this communication is informational, general in nature and does not constitute legal advice. The material contained in this communication should not be relied upon or used without consulting a lawyer to consider your specific circumstances. This communication was published on the date specified and may not include any changes in the topics, laws, rules or regulations covered. Receipt of this communication does not establish an attorney-client relationship. In some jurisdictions, this communication may be considered attorney advertising.