Paid Family & Medical Leave – Another Round of Updates

With the reporting deadline approaching on August, 31 and the final rule-making phase now in draft form, we have some updates to what employers need to know about Washington's new Paid Family & Medical Leave law.

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There are six phases of rulemaking that the Employment Security Department has been working through to solidify the rules surrounding Paid Family & Medical Leave. We’ve written about the first four at length and now we have direction as to the results from final two phases, with proposed Phase 5 rules and drafted Phase 6 rules. Unfortunately, we still have not seen final, nor even drafted, rules regarding the coordination of PFML benefits with Short Term Disability insurance. We will provide another update once we know more. For now, we call out some of the main updates since our last blog. 
 
Employer Reporting
The PFML program requires employers to report hours and wages to the state on a quarterly basis, beginning with 2019, Q1. The first deadline, April 30, was extended, and then extended again. The final deadline has been set as August 31 for both Q1 and Q2 data to be submitted. The ESD has created a very comprehensive employer reporting website that provides not only information about what to file, but videos on how to file.
 
Rulemaking - Phase 5 (Proposed rules)
Phase 5 outlines job protection, benefit overpayments, and “miscellaneous” items. The final proposed rules have been published, although there is still time for slight changes to be made. Below are a few items that will be of interest to employers.

• Full-Time Faculty Employees – An employer would report 35 hours per week for a faculty member that has a “full-time academic workload” as defined in RCW 28B.50.489. (Note that this is lower than the 40 hours required for salaried employees). 
• Part-Time Faculty Employees - Part-time faculty hours will be more complicated; reported as a percentage of full-time hours. Hours reported will equal the instructor’s hours worked divided by full-time hours (deemed by the institution) times 35 hours (this rule’s full-time definition of faculty hours). Here’s an example:

• Assume a technical college deems a teaching workload of 15 hours to be full-time
• An instructor teaches a workload of 12 hours per week (including class and lab hours)
• Hours worked = 12 / 15 x 35 = 28 hours

• Collective Bargaining Agreements – PFML will not apply to those covered under a CBA in effect before 10/19/2017, unless and until the agreement expires, is reopened, or is renegotiated. The final rules allow for those under such a CBA to become subject to PFML prior to the CBA expiring, being reopened or renegotiated, if all parties agree and submit required information to the Employment Security Department (ESD).

 
Rulemaking - Phase 6 (Draft rules)
Phase 6 draft rules have been posted to the paid leave rulemaking site. Finalization of these rules is slated for 8/29/2019, when the comment period will begin (runs through 11/12/2019). Of note under the draft rules:

• Supplemental Benefit Payment – An employee may be able to use paid time off to “top off” the benefit payment they receive under PFML. However, this will only be allowed if the employer designates time off as “supplemental benefits” to PFML. This can include (but is not limited to) salary continuation, vacation leave, sick leave, and/or other paid time off. These payments do not need to be reported in pay and hours to the Employment Security Department (ESD). 
• Paid Time Off Not Deemed Supplemental Benefits – As the rules are currently drafted, if an employee takes paid time off that is not deemed “supplemental benefits” by the employer, those hours will be considered as hours worked and PFML benefits will not be paid for those same hours. 
• Benefit Waiting Period – For a family leave during the first 12 months after the date of a child’s birth or placement, there will be no waiting period for PFML benefits. Otherwise, there will be a 1-week waiting period that will be satisfied once the employee takes 8 consecutive regularly scheduled work hours of leave in a calendar week, defined as Sunday through Saturday. 
• Benefit Calculation – When calculating PFML benefits for an eligible employee, the state will take the total gross wages the employee earned in the 2 highest paid quarters in the prior 4 full quarters worked, divide by 26, and round down to the nearest dollar. 
• Appeals Deadline – When filing an appeal of an ESD determination, the employee or the employer will need to file the appeal within 30 days of the date of the notification or mailing they receive.
• Small Business Assistance – Employers with fewer than 50 employees can opt into the Small Business Grant program, but to do so they must pay the employer’s portion of the PFML insurance premium. When opting in, the employer will be “locking in” this decision for a minimum of three years.

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 The Bottom Line
Washington State’s Paid Family & Medical Leave is still a work in progress, but we are seeing the light at the end of the rule-making tunnel. We will continue to provide updates as they are finalized by the state.  

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