We are writing to provide you with further details regarding the recent amendments made to Maryland’s Family and Medical Leave Insurance (FAMLI) Program through the passing of Senate Bill (SB) 828. These changes introduce various adjustments, including those to the start date of the program, administrative processes, employer and employee contributions, benefit coordination, and the reimbursement of certain service providers.
Here are the significant differences between the new law, SB 828, and the previous legislation known as the “Time to Care Act”, which came into effect on June 1, 2022, and established the FAMLI Program:
- Revised Start Dates: SB 828 postpones the commencement dates for required contributions and benefit payments by one year. Thus, contributions will now begin on October 1, 2024, while employees may begin submitting claims for benefits on January 1, 2026.
- Fixed Employer/Employee Contribution Split: SB 828 establishes a fixed employer/employee contribution split of 50/50. This modification removes the requirement for the Secretary of Labor to determine the split every two years based on a study.
- Initial Total Rate of Contribution: The Secretary of Labor is responsible for setting the initial total rate of contribution by October 1, 2023. This rate will apply from October 1, 2024, through June 30, 2026, and must not exceed 1.2% of an employee’s wages. The rate applies to all wages, including those up to and including the Social Security wage base.
- Benefit Coordination and Use of Paid Leave: Under the amended legislation, individuals are no longer obligated to exhaust all non-required employer-provided leave before receiving FAMLI benefits. However, employers retain the authority to coordinate FAMLI benefits with other benefits or leave. Furthermore, individuals and employers can agree to utilize paid leave and FAMLI benefits to replace up to 100% of the individual’s average weekly wage during the FAMLI leave period.
- Reimbursement to Service Providers: SB 828 mandates that the Maryland Department of Health (MDH) reimburses certain service providers for a portion or all of the employer share of FAMLI contributions on at least a quarterly basis. The specific reimbursement amounts depend on various factors, including the type of service provider and the revenue derived from federal and State Medicaid funding and other State funding during the covered period.
- Definition Changes: SB 828 also revises one of the Time to Care Act’s definitions by adding domestic partners as covered “family member[s]”. Additionally, the amended legislation broadens the qualifying reasons that apply for FAMILI benefits, such as to take care of or bond with an infant during the first year after their birth.
For more information on Senate Bill 828, we encourage you to review the legislation text here.