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Massachusetts Delays Paid Family and Medical Leave

by Symmetry Tax Updates | Jun 14, 2019
Payroll deductions for the Massachusetts's Paid Family and Medical Leave program (PFML) were initially required to begin on July 1, 2019. However, the Massachusetts Legislature and the Baker-Polio Administration recently signed a bill delaying the start of contributions. Payroll tax contributions for the PFML program will begin on October 1, 2019, and the program will start in January 2021.

The delay of this plan will allow for everyone to better prepare. Massachusetts Legislative Leaders have more time to make any necessary changes to the program. To compensate for the shorter amount of time to collect contributions, the Department will be adjusting the contribution rate so that full funding may be reached before January 2021. The old contribution rate is 0.63% and will be modified to 0.75%. 

Employers now have more time to review the duties and requirements of this plan. For the final quarter of the year, they must remit the necessary employee and employer contributions through MassTaxConnect by the end of January 2020. Employers have the option to apply for an exemption before December 20, 2019, if they feel that their paid leave benefits are more compensable than the PFML benefits.

Employers will also need to notify all covered individuals before September 30, 2019. Employers should communicate all rights and obligations under PFML to their employees. Employers should view the final regulations that will be posted Monday, June 17 to mass.gov/pfml. Regulations are listed under the title "458 CMR 2.00 DEPARTMENT OF FAMILY AND MEDICAL LEAVE" and will be effective July 1, 2019.

Massachusetts, as well as a few other states, is implementing the PFML without an existing temporary disability insurance infrastructure already established. Implementing and finalizing the program is a big task for any state. Go to mass.gov/pfml to stay informed on how your company could be affected.
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