Massachusetts Paid Family and Medical Leave Law (PFML)
Massachusetts Employers Required to Deduct a Percentage of Employee & 1099 Payments to Fund Massachusetts Paid Family & Medical Benefits to Employees Beginning October 1, 2019*
*July 1, 2019 start date recently delayed on June 11, 2019 vote
In 2018, Massachusetts passed the Paid Family Medical Leave Law, that is set to take effect beginning on October 1, 2019. Massachusetts law. MGL c.175M as added by St. 2018, c.121 establishes a system for paid family leave of up to 12 weeks to care for a family member, and up to 20 weeks for your own illness, for up to 26 weeks a year of paid leave.To pay for these benefits, the tax contribution requirement begins in 2019, and leave benefits will be available January 2021 (medical leave) and July 2021 (family leave).
Updates Available on Mass.Gov Website
As More information becomes available or clarifications are made, The Massachusetts Department of Family and Medical Leave updates their website. Click here to visit the Mass PFML Website.
Which Employers are Required Under PFML?
If you employ Massachusetts employees or 1099 contractors you are required to contribute to PFML- this includes Massachusetts W2 employees (full-time, part-time, seasonal) and Massachusetts 1099-MISC contractors paid for services. Non-profit organizations, religious institutions*, and colleges and universities employing students are also required to comply with PFML.
Certain types of employment that are excluded from unemployment law are also exempt from PFML benefits, including:
- Services performed for a son, daughter, or spouse
- If under 18, services performed for one’s father or mother
- Services performed by inmates of penal institutions
- Employment in the railroad industry
- Services provided by real estate brokers/sales people and
insurance agents/solicitors in commission-only jobs
- Newspaper sales and delivery by persons under 18
- *Employment by churches and certain religious organizations
- Services of work-study students, student nurses and interns, and work trainee programs administered by nonprofit or public institutions
Certain exempt employers listed above can opt into the MA PFML program by notifying the DFML and following its procedure to enroll.
Family and Medical Leave Timetable
March 31, 2019: Proposed regulations published
July 1st, 2019: Finalized Regulations Published
September 30th, 2019: Notify your Covered Individuals in Writing of PFML Law and Benefits
*Recently delayed from June 30, 2019-Must have workplace posters up and have written acknowledgement from all covered individuals
What if employees were already notified prior to the June 14th delay?
If you already distributed written notices to your employees and 1099 contractors prior to the June 14 delay announcement, you will need to provide them with a rate update sheet explaining the new dates and contribution rates. This sheet doesn’t have to be signed by the covered individual but employers must keep a record of its distribution on file.
October 1st, 2019*: Begin collection of tax of 0.75 percent
*Recently changed from July 1 to October 1, 2019, and increased from 0.63% to 0.75%. Adjustment was made to ensure that full funding will be in place for the commencement of benefit payments in January 2021
When do PFML contributions get paid?
Withholdings will be based on the date that wages are paid (commonly referred to as ‘employee pay check date’) regardless of the date the employee performed those services. For example, if an employee receives a paycheck on or after October 1, 2019 where some of those wages were for services performed prior to October 1, 2019, then all of the wages in the paycheck will be subject to contributions.
December 20, 2019 Deadline for Employers to apply for an Exemption
Employers that offer paid leave benefits that are at least as generous as those required under the PFML law may apply to the Department for an exemption from making contributions. Employers will now have until December 20, 2019, to apply for an exemption.
January 1, 2021: Medical Leave Benefit becomes available
July 1st, 2019: Family Leave Benefit becomes available
Who Pays This Tax?
Employers are responsible for remitting family and medical leave contributions on behalf of employees. Employers with fewer than 25 employees will not be required to pay the employer’s contribution, but will still need to remit payment to the Department of Family and Medical Leave.
Employer PFML Contributions- 25 or More Employees
Employer PFML Contributions- Less than 25 Employees