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What you need to know about NY's Paid Family Leave benefits

What you need to know about NY's Paid Family Leave benefits

Participation mandatory for almost all private employers; voluntary for public employers
What you need to know about NY's Paid Family Leave benefits
Photographer: Shutterstock

Look for a new nibble out of your paycheck soon.

New York state is gearing up to start its latest mandated worker benefit: an enhanced Paid Family Leave program.

The state last week finalized regulations that take effect Jan. 1 and allow most workers to take up to eight weeks off at 50 percent pay to deal with family matters. The benefit will ramp up over four years, reaching 12 weeks’ leave at 67 percent pay by 2021.

Participation is mandatory for almost all private employers but is voluntary for public employers. It will be funded by a deduction from employees’ paychecks that employers will use to purchase insurance coverage.

In announcing the measure, Gov. Andrew Cuomo called it the most comprehensive of its kind in the nation.

Workers won’t see a huge amount of money coming out of their paychecks at this point. In 2018, the maximum employee contribution will be 0.126 percent of weekly pay — $1.26 for someone earning $1,000 per week or 63 cents for a $500-per-week worker. The income level plateaus at $1,305.92. So three people earning $1,305.92, $5,067 or $10,500 a week, respectively, will each see $1.65 deducted from their weekly paychecks. If they went out on family leave, they’d all get paid $652.96 a week — half of $1,305.92.

Workers are entitled to keep their health benefits while on leave and are entitled to return to their jobs at the end of their leave, under the new rules.

Workers’ advocates cheered the impending arrival of the provision, which Cuomo signed into law in 2016.

“All workers deserve time to care for their loved ones, and no one should have to choose between that care and a paycheck,” Karen Scharff, executive director of Citizen Action of New York, said in a prepared statement. “New York’s Paid Family Leave program will protect families, our communities and our economy and begin to address years of growing inequality."

Dina Bakst, co-founder and co-president of A Better Balance, said, “This groundbreaking program, which will begin protecting workers in January, will ensure working New Yorkers will no longer have to make the impossible choice between being with their families when they need them the most and their economic security.”

Employers, meanwhile, have to get their ducks in a row to be ready for the new rules.

Helping them do this are labor attorneys such as Sanjeeve DeSoyza at Bond, Schoeneck & King in Albany.

He said that, although the dollar amounts are small and are coming from employees rather than employers, the new regulations are nonetheless one more burden on doing business in New York.

DeSoyza conceded, though, that enhanced paid leave will provide a lifeline to people in tight circumstances.

“It’s going to benefit some employees that otherwise would not have been able to maintain their job,” he said, giving as an example the single mother with a sick child.

“I think employers appreciate that, too.”

But there is also the opportunity for abuse by employees, he added: Taking what is essentially a partially paid vacation when they don’t really have a pressing need for one.

The impact of the new regulations will be greatest on small companies, DeSoyza predicted, because one person absent from a 10-person operation has a much greater impact than from a 100-person operation under the same circumstances.

He’s hearing some unhappiness from clients as the new rules become more widely known.

“There’s a lot of frustration out there that it’s another burden for employers that makes it harder to operate in New York,” DeSoyza said.

He noted that the federal Family and Medical Leave Act — itself one of the biggest sources of business for his practice — exempts companies with fewer than 50 employees. 

By contrast, New York’s new Paid Family Leave program affects private employers with as few as one employee. 

Employees can opt out only under limited and specific circumstances, DeSoyza said, such as being short-term part-time employees. Employers could try to reclassify their employees as contractors to evade the requirements, but that could backfire, he added.

The final regulations for the state’s new leave program were issued Wednesday, DeSoyza said. Until that point, he was advising clients to get ahead of the curve — review their paid time off and paid leave policies but don't make any changes. Now that the regulations are in place, he’s advising them to bring those policies in for review to be sure they comply with the new law. Next step: Modify those policies as needed, publish them internally and make sure employees understand them. And then get an insurance policy in place.

DeSoyza said he hasn’t taken a survey of other states, but given the tenor of New York policies and politics, he wouldn’t doubt Cuomo’s boast that the new program is the most comprehensive family leave plan in the nation.

“It’s a very generous benefit, no doubt,” he said.

Employees will bear the cost of the premiums, but employers will bear the costs of the new program itself, he noted.

“I think there are going to be administrative costs for employers, too,” he said. “Management of the leave, even though it’s paid for by the [insurance] carrier, the employer still has to keep track of who’s out.”

DeSoyza said employees at smaller workplaces with a close-knit culture might be less likely to abuse their rights to family leave. However, when someone does take off, these small employers would feel the absence much more keenly than a large corporation would.

“There are the non-quantifiable costs,” he said. “The cost of people not being there, replacing them, impact on production.

Those are the costs that our employers are looking at now.

“The smaller you are, the scarier this might look to you.”

DeSoyza, a Bronx native and Niskayuna resident, has practiced labor and employment law for 15 years.

The details

As of Jan. 1, 2018, New York’s Paid Family Leave program:

Provides coverage for employees:

  • During the first 12 months following the birth, adoption or fostering of a child.
  • Caring for a spouse, domestic partner, child, parent, parent-in-law, grandparent or grandchild with a serious health condition.
  • Assisting loved ones when a spouse, child, domestic partner or parent is deployed abroad on active military duty.

Eligibility extends to employees:

  • With a regular work schedule of 20 or more hours per week after 26 weeks of employment.
  • With a regular work schedule of less than 20 hours per week after 175 days worked.

Insurance coverage:

  • Will typically be included as a rider to an employer’s existing disability insurance policy.
  • Will be fully funded by employees through payroll deductions.
  • Will be mandatory for private employers.
  • Will be optional for public employers.
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