New York Paid Family Leave (NY PFL) is a benefit program that offers paid leave to New York employees while they bond with a new child, care for a close relative with a serious health condition, or when an employee’s family member is called to active military service. NY PFL took effect January 1, 2018, and was designed to phase in over a period of 4 years. NY PFL is funded through employee payroll contributions that are reviewed and set annually by the Department of Financial Services (DFS) to match the cost of coverage. Employers should revisit NY PFL’s core requirements and become familiar with the following updates to ensure compliance with leave requests beginning January 2021.
Which Employers are Subject to NY PFL?
Employers with employees working in New York for 30 or more days in a calendar year must obtain NY PFL insurance. NY PFL applies to employees who work in New York, irrespective of where the employee lives or where the employer is headquartered.
Which Employees can Utilize NY PFL?
Employees who work in New York and who:
- regularly work 20+ hours per week and who have worked more than 26 consecutive weeks; or
- regularly work less than 20 hours per week and who have worked more than 175 working days.
Can an Employee Waive NY PFL Coverage?
Employees cannot opt-out of the PFL program unless they are in a temporary position that will not allow them to attain the 26 consecutive weeks or the 175-day requirement. Employees who will not meet the time requirement must be provided with a waiver form.
What is the Employer Notice Posting Requirement?
Employers must post and maintain a Notice of Compliance with NY PFL in a conspicuous place, similar to what is required for Worker’s Compensation and Disability Insurance coverage. Insurance carriers will provide this notice stating the employer has NY PFL insurance. If you are self-insured for NY PFL coverage, you may receive this notice by contacting the Worker’s Compensation Board at Certificates@wcb.ny.gov. Employers should also consider providing the Notice of Compliance electronically, or posting it on an accessible website, for those employees that are teleworking in light of the ongoing COVID-19 pandemic.
2021 NY PFL Updates
What are the NY PFL Premium Rates for 2021?
NY PFL requires employers with New York employees to purchase NY PFL insurance, which provides employees with NY PFL benefits. Employers can either pay for the insurance or they may deduct a “premium rate” from employees’ gross wages to fund the insurance premium set annually by DFS. For 2021 the premium rate has increased, meaning that an employee’s maximum annual contribution will increase. In 2021 employers can deduct up to 0.511% of employees’ gross wages, up to an annual cap of $385.34, to fund NY PFL insurance. Employers may start taking deductions at the 2021 rate on January 1, 2021.
What are the NY PFL Benefit Amounts for 2021?
In 2021, employees who take NY PFL will receive 67% (increased from 60% in 2020) of the lesser of their average weekly wage (AWW) or the Statewide Average Weekly Wage (SAWW) for up to 12 weeks of leave (up from 10 weeks in 2020). The current SAWW in New York is $1,450.17, which means the maximum required weekly benefit for 2021 is $971.61 ($1,450.17 x 67%) . The SAWW updates are typically released annually around March 31st and apply to the following year’s NY PFL deductions and benefits caps. Employees earning less than the current SAWW will contribute less than the annual cap.
2021 New York State Paid Family Leave at a Glance
|Maximum Time Off||12 weeks|
|Weekly Wage Replacement||67% of employee AWW|
|Maximum Weekly Wage Replacement||$971.61 (67% of current SAWW of $1,450.17)|
|Payroll Deductions (per pay period)||0.511%, of employees’ gross wages each pay period|
|Annual Payroll Deduction Cap||$385.34|
General Employer Considerations and Action Items:
- Ensure you have NY PFL Coverage – If you are self-insured for disability, you may purchase a separate PFL policy or apply to self-insure. Generally, PFL will be added to the disability insurance policy you already carry.
- Post a Workforce Notice – Your insurance carrier will provide a Notice of Compliance stating you have PFL insurance. If you are self-insured, you can get this notice by contacting the Board at Certificates@wcb.ny.gov to obtain the required notice. Post and maintain this notice in a conspicuous place, similar to what is required for Worker’s Compensation and Disability Insurance coverage. Employers should also consider providing the Notice of Compliance electronically, or posting it on an accessible website, for those employees that are teleworking in light of the ongoing COVID-19 pandemic.
- Inform Your Employees About NY PFL – Update appropriate written employee materials, such as employee handbooks, etc.
- Update Your Payroll Processes – Update internal processes or work with your external payroll manager to collect the appropriate employee payroll withholding.
- Inform Non-Eligible Employees About Waivers – Identify employees who will not qualify for the minimum amount of time required for eligibility and let them know they can choose to waive coverage. Employees will need to complete a waiver. Keep a copy of completed waivers on file.
- Be sure to get familiar with NY PFL Forms and other Resources. You are not required to use the forms provided by the state. Review and fill out Part B of the applicable claim form when received from an employee and return it to the employee within 3 business days (this process is outlined on the claim form). The employee should then submit the form and supporting documentation to the insurance carrier. The insurance carrier will accept or deny the NY PFL claim within 18 days.
Sequoia One Clients ONLY: Your HRBP will be able to assist you with NY PFL employee leave requests and your Sequoia One Payroll team will update the employee contribution rate withholding for 2021, as necessary.
- Post a Workforce Notice – Your insurance carrier will provide a Notice of Compliance stating you have PFL insurance. Post and maintain this notice in a conspicuous place, similar to what is required for Worker’s Compensation, Disability Insurance coverage, and State Labor Law Posters.
- Inform Your Employees About NY PFL – Your Sequoia One on-boarding portal will be updated to inform your employees about NY PFL requirements and their tax obligations required based on their work hours.
- Review the Leave Process with your HRBP – Review the process of placing an employee on a leave of absence with your HRBP prior to the employee taking the requested leave.
- 2021 Premium Rate Announcement
- New York Paid Family Leave at a Glance 2021
- New York Paid Family Leave Website
- New York Paid Family Leave Updates for 2021
- Model Language for Employee Materials – Updated for 2021
- Employee Notice of Payroll Deduction for 2021
- 2021 Statement of Rights
- New York Paid Family Leave Employer Responsibilities and Resources
- Employee Paid Family Leave Opt-Out and Waiver of Benefits
- Subscribe to New York Paid Family Leave Updates Here
- Sequoia Blog: Get Ready for New York Paid Family leave in 2020
Disclaimer: This content is intended for informational purposes only and should not be construed as legal, medical or tax advice. It provides general information and is not intended to encompass all compliance and legal obligations that may be applicable. This information and any questions as to your specific circumstances should be reviewed with your respective legal counsel and/or tax advisor as we do not provide legal or tax advice. Please note that this information may be subject to change based on legislative changes. © 2020 Sequoia Benefits & Insurance Services, LLC. All Rights Reserved