We’ve all heard the saying, “Put your family first” and Colorado government is doing just that by issuing its First Round of Regulations and Guidance on its Paid Family and Medical Leave Insurance (“FAMLI”) program.
Benefits under the program do not officially start until January 1, 2024, however premiums must be submitted to the program beginning January 1, 2023.
What is the FAMLI program and who is eligible for its benefits?
The new program is designed to provide all employees with up to 12 weeks of paid leave in the following circumstances:
- To care for their own, or a family member’s serious health condition
- To care for a new child during the first year after birth, adoption or placement of a child
- When time is needed to arrange for a family member’s military deployment
- To take “safe leave,” when an employee or a family member is a victim of domestic violence, stalking, or sexual assault/abuse
Employees who work for mid-size to large companies, those with 50 or more employees, have enjoyed leave under the federal Family Medical Leave Act (“FMLA”) since 1993, but not those employees of small employers, so this new benefit is a huge deal. FAMLI also includes “paid” leave, that is not currently included in the federal FMLA program. Employees can expect to receive between 65-90% of their wages under the new program, with a capped amount of $1,100 per week.
Those who experience pregnancy or childbirth complications may receive up to four additional weeks of leave.
How is the FAMLI leave program affected by other types of leave, including FMLA?
FAMLI is designed so that leave can be taken alongside FMLA so that employees are not “stacking” leave. In other words, the program is designed so that employees are not taking 12-16 weeks FMLI leave, and then another 12 weeks of FMLA leave, but the employer must specifically let the employees know this is their standard prior to.
Employers and employees alike should be aware that while an employee can take FAMLI leave, and combine with accrued paid time off via vacation, sick leave or other paid time off program, the employee may not receive more compensation than their average weekly wage.
When do the benefits under the FAMLI start?
Benefits under the program officially start January 1, 2024, however employers must begin paying premiums themselves, as well as deducting from employee’s paychecks and then submitting both premiums to the program via an online system at the close of each quarter, beginning January 1, 2023.
What are associated costs of FAMLI?
The .9% payroll tax is to be funded 50/50 between the employer and the employee. If an employer would like to add this benefit as a perk to employees, the employer may elect to pay the full .9% themselves.
Given that companies are contributing to the cost of the program, they will not be responsible for paying the employee while on FAMLI leave, rather employees on approved leave will be paid by the state. This provides businesses the ability to hire a temporary employee or pay overtime to other employees to help cover the duties of the employee on leave.
Employers with less than 10 employees are not required to pay the employer share of premiums. Conversely, employers with 10 or more employees in the first quarter will be required to pay its percentage every quarter, even if their employee count falls to below 10 employees any time during the remainder of the year.
Are there alternative options to participating in the FAMLI program?
Employers who offer their own paid family and medical leave benefits may be able to continue to do so after applying and receiving an exemption from the FAMLI Division. The private plan must be equal or better than the public plan in regard to rights, protections and benefits. Employers are responsible for submitting FAMLI premiums until the FAMIL Division approves the private plan. Employers will need to keep in mind that they may not charge the employee any more for the private plan than the employee would pay under the state’s plan.
Private medical leave plans can be submitted by carriers for approval to the FAMLI Division beginning
November 2022. More details on this will be flushed out in the coming months.
What else should I know about the new program?
- Employers need to be aware that the FAMLI program includes returning the employee to their prior held position, or a position of equivalence, when returning to work
- Employers are not permitted to interfere with employees FAMLI rights nor may the employer retaliate against an employee who takes leave
- Self-employed workers may elect to participate in the program
For more information on this topic, please go to: Home | Family and Medical Leave Insurance (colorado.gov) or copy/paste https://famli.colorado.gov/ into your web browser.
For “Employer FAQs,” go to: Employer FAQs | Family and Medical Leave Insurance (colorado.gov) or copy/paste https://famli.colorado.gov/employers/employer-faqs into your web browser.
Please stay tuned for more information from Blue Chip Benefits on this important topic, in the coming months.
For more information, contact Maureen at MaureenDJ@BlueChipBG.com or call (888) 225-8244, x701
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This update is not intended to be exhaustive, nor should any discussion or opinions be construed as legal advice. Readers should contact legal counsel for legal advice. Copyright © 2022 Blue Chip Benefits. All right reserved.