Colorado Issues First Paid Family and Medical Leave Insurance Regulations
All Employers with CO Employees
January 1, 2023
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Colorado issued long-awaited regulations regarding its Paid Family and Medical Leave Insurance Program (FAMLI). As a review, nearly all Colorado employers with at least one employee must comply with FAMLI on January 1, 2023. Employees can start receiving FAMLI benefits beginning in 2024. Employees will be able to use paid leave to:
- Care for their own serious health condition;
- Care for a family member’s serious health condition;
- Care for a new child during the first year following birth, adoption, or placement;
- Make arrangements for a family member’s military deployment; or
- Address the employee’s or their family member’s status as a victim of domestic violence, stalking, sexual assault, or abuse.
Generally, employees may take up to 12 weeks of paid leave. If leave is needed because of complications in pregnancy or childbirth, employees may take an additional four weeks leave.
Beginning on January 1, 2023, employers must begin deducting premiums. The premium will be a 0.9% payroll tax, split 50/50 between the employer and the employee if the employer has 10 or more employees. Employers with fewer than 10 employees are not required to pay the employer share of the premium. If desired, employers may pay more than their 0.45% requirement. Premiums must be taken from all wages but will be capped at the Social Security Wage base, which is updated annually.
Employers with private plans do not have to comply with FAMLI, so long as the private plan is equally as generous as FAMLI requires. In November 2023, carriers and employers may submit private plans for approval. Additional guidance on this process is expected later this year.
Many employers have wondered how FAMLI works with other laws and their own PTO policies. According to the regulations, employers cannot require employees to use accrued PTO time before using, or while receiving, FAMLI benefits. Because FAMLI benefits may not be a full wage replacement, employers and employees can agree to use PTO to make up the difference between their actual wages and the FAMLI benefits they receive. However, employees cannot receive more compensation than their average weekly wage.
FAMLI leave will run concurrently with FMLA. Employers should remember, however, that FAMLI leave eligibility and FMLA eligibility, while similar, are not identical. An employee may be eligible for FAMLI leave but not eligible for FMLA leave. Employers can also require that FAMLI leave run concurrently with the employer’s short-term and long-term disability programs if the employer provides written notice to the employee.
Employers must also provide notice of employee rights under FAMLI. The notice, found here, must be given to all new employees and be displayed in a prominent spot in the workplace. If the employer learns that an employee has experienced a qualifying event, they must also remind the employee of their FAMLI rights.
Employers should continue to prepare for FAMLI implementation. Employers with private plans should consult with legal counsel to evaluate their potential exemption status. Further regulations are expected, so employers should continue to monitor all aspects of the law before its 2023 start date.
- Prepare to update leave policies.
- Prepare for payroll deductions.
- Update new hire procedures to include required notice.
- Display required poster in the workplace.
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Disclaimer: This document is designed to provide general information and guidance concerning employment-related issues. It is presented with the understanding that ManagEase is not engaged in rendering any legal opinions. If a legal opinion is needed, please contact the services of your own legal adviser. © 2022 ManagEase