Hunton Employment & Labor Perspectives

In a statement issued last week, Massachusetts Governor Charlie Baker, along with state house and senate leadership, announced that lawmakers had agreed to implement a three-month delay to the Massachusetts Paid Family and Medical Leave (PFML) law, which Hunton Andrews Kurth, LLP previously reported about here. In the joint statement, the leaders explained:

To ensure that businesses have adequate time to implement the state’s Paid Family and Medical Leave program, the House, Senate, and Administration have agreed to adopt a three-month delay to the start of the required contributions to the program. We will also adopt technical changes to clarify program design. We look forward to the successful implementation of this program this fall.

This announcement is positive news for employers that are facing a July 1, 2019 contribution start date. This three-month delay will also be reflected in other deadlines associated with the PFML law:

• September 30, 2019: All employers in Massachusetts must provide employees with a notice of rights under the new law.
• December 20, 2019: Employers interested in obtaining an exemption from the PFML’s contribution requirements must file for the exemption.
• December 31, 2019: Employers will be responsible for remitting contributions for the final quarter of the calendar year through MassTaxConnect.

Additionally, in order to offset the lost rate revenue associated with the three-month delay, the Department of Family and Medical Leave announced that the total contribution rate has been increased from 0.63% (for up to the first $132,900 of an employee’s salary) to 0.75%. This means that the total annual contribution for an employee earning $132,900 or more will be increased from $837.27 to $996.75.

The most recent delay gives employers additional time to consult with employment counsel and familiarize themselves with the PFML law’s numerous requirements and deadlines.

We will continue to monitor and provide updates to our clients on PFML developments.