Even though payroll deductions began in January, the details of the law are still being hammered out. Big changes have already been enacted and more are still to come. Here's what we know so far.
(Updated 7.14.2019 to include finalization of Phase 4.)
Just when you thought you might have Washington’s new Paid Family & Medical Leave (PFML) program figured out, in early April, Substitute House Bill 1399 was signed into law, fundamentally changing the program. In addition, the Employment Security Department has been working behind the scenes on final rulemaking. A summary of the moving parts is included, but don’t get too comfortable. These may continue to change as the Employment Security Department (ESD) winds its way through the Phases of implementation.
Substitute House Bill 1399 – stacking allowed
One of the biggest changes is that this newly signed bill specifies an employee can simultaneously receive both Washington State Paid Family & Medical Leave (PFML) benefits and paid leave from their employer. This could be in the form of vacation, sick leave or other paid time off. The bill stipulates that together the benefits cannot provide more than 100% of earnings. Overall, this change has been well-received since the $1000 maximum weekly PFML benefit generally falls short of actual pay for many employees in Washington. Allowing paid time off to stack on top of PFML will allow more employees to actually afford to take the time off that they need.
One drawback of this new rule for employers is the effect of WAC 192-610-075 (see Phase 4 below – Paid Time Off). Under Phase 4 proposed rulemaking, employers cannot require employees to take paid leave prior to or while receiving PFML. This could result in an employee taking PFML for the maximum duration, then dipping into their paid leave in order to take additional time off of work.
Rulemaking - Phase 3 Finalized
Phases 1 and 2 were finalized near the end of 2018, providing guidance surrounding premiums, employer responsibilities, penalties, small business assistance and voluntary plan rules. Phase 3 was finalized in early 2019, providing benefit application and benefit eligibility guidelines. Here are some of the biggest changes:
Rulemaking - Phase 4 Finalized
While Phase 4 purports to be about continuation of benefits and fraud, there are many more rules that will be of concern to employers.
Rulemaking - Phase 5 still to come
Phase 5 outlines job protection, benefit overpayments, and “miscellaneous” items. The final proposed rules will not be published until May 21st.
Rulemaking - Phase 6 on the horizon
Phase 6 draft rules have not been provided as of yet. The Employment Security Department notes that topics will include appeals and any necessary changes due to the 2019 Legislative Session.
The Bottom Line
Washington State’s Paid Family & Medical Leave is still a work in progress. To provide your input, consider attending an upcoming Rules Meeting. We will continue to provide updates as they are proposed, drafted and finalized by the State. In the meantime, I recommend visiting the PFML “Questions” site to see what people are asking, and more importantly, what answers they are being provided.
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I love numbers. I'm a math geek. I read benefits industry articles and periodicals for relaxation (but, honestly, I'm still a fun gal). I also like to share what I've learned and you'll find it all here.