Massachusetts Family and Medical Leave Regulations Impose New Paperwork and Contribution Burdens on Employers

With implementation of a tax under the recently enacted Massachusetts Family and Medical Leave Act less than five months away, the newly formed Department of Family and Medical Leave has issued draft rules for the program. As expected, they will impose substantial new burdens on employers.

The Department will begin collecting .63% of total employee payroll up to a specified cap, including money paid to independent contractors, on July 1, 2019. Employees cannot begin using leave for their own medical conditions, to care for family members, or for child birth/adoption, until 2021. Though the rules are not yet final, changes are unlikely to be major. At the moment, the Department of Family and Medical Leave will impose the following requirements.

  • All employers must register their workers, both W2 and 1099, the through Department of Revenue’s MassTax Connect System. Quarterly filings and contributions will be required.
  • Though no employer can avoid making payments, those with fewer than 25 workers can deduct 100% of them from employee pay. For employers with more than 25 workers on average, roughly half of total contributions can be deducted from employees, though percentages may change.
  • Employers with private plans that provide equivalent benefits can apply for exemption from the program.
  • Beginning January 1, 2021, employees can apply for up to 12 weeks of family and 20 weeks of medical leave annually, with a cap of 26 total weeks. Intermittent leave is permitted and the initial maximum weekly payment will be $850. Employees will be required to certify the reasons leave is required.
  • Employees must be returned to their regular jobs at the end of leave, with limited exceptions. Employers must continue to pay health insurance costs during leaves, and negative effects on employees may be presumed to be retaliatory and thus illegal.
  • Employees may sue to enforce their rights. Courts will have the discretion to issue a wide array of relief, including reinstatement, triple damages for lost wages, and legal fees. Employers who don’t make required contributions will be required to make them up without employee deduction and to refund to the Department for benefits paid to a non-contributing employee.