Massachusetts Paid Family and Medical Leave Part 2: Key Differences in the Revised Regulations


In our last blog post on Massachusetts Paid Family and Medical Leave (“MAPFML”), we reviewed the Department of Family and Medical Leave’s (the “Department”) draft regulations published in January 2019 and outlined some of the questions left unanswered by the then-current regulations.  Since January, the Department has held a number of listening sessions throughout the Commonwealth soliciting comments and feedback on the draft regulations.  On March 29, 2019, the Department published revised draft regulations for public comment and hearing.  The regulations are set to be finalized on July 1, 2019, which is also the effective date of MAPFML and the commencement date for payroll deductions from employee paychecks. 

This post provides a high-level overview of some of the key changes in the revised regulations, and delves more deeply into some of the most common questions (and answers!) that are still plaguing employers as a result of the developments in the regulations.

Key Differences in the Revised Regulations

To comment on the draft regulations during the public comment period please follow this link.

Scope - Which Employers Does MAPFML Apply To?

Multi-state employers with employees in Massachusetts are deciphering how MAPFML applies to their business and workforce.  The revised regulations outline the following test, which applies to determine both whether a business and whether an individual are subject to MAPFML:

The bottom line is that employers outside of Massachusetts can still be covered employers if they have employees or contractors working or living in Massachusetts.

Staffing Agencies and Temporary Employees

The revised regulations struck temporary employees from an employer’s average workforce headcount, clearing up some of the confusion for those employers operating in the staffing world or who engage temporary employees.  Employers that use temporary workers as part of their workforce are not required to count temporary employees, but they are still required to count seasonal workers and independent contractors. 

Short-Term Disability and Other Paid Employer Benefits

The revised regulations provide that unless the aggregate amount a covered individual receives would exceed their average weekly wage, the weekly MAPFML benefit amount will not be reduced by a temporary disability policy or program of the employer.

Short-Term Disability and Private Plan Exemptions

The Department has also clarified that it will be accepting private plan exemptions on April 29, 2019 (recall that benefits under a private plan must be greater than or equal to those provided under MAPFML). Employers will be able to apply for exemptions online, and will be notified immediately of approval or denial.  Note that even if a private plan is approved as exempt, employees will still be entitled to MAPFML protections, such as the right to an appeal if their application for benefits is denied, the right to job protection during any leave taken, and protections against retaliation from taking leave or exercising MAPFML rights.  Employers with exempt private plans will not be required to remit payments to the MAPFML Trust.  

Many employers are also hoping that their private, short-term disability insurance policy might qualify as an exemption under the medical leave portion of MAPFML.  While this may be so in some cases, most short-term disability policies are not available for part-time or seasonal workers.  On this basis alone, many short-term disability plans will not be eligible for exemption. For more information on private plan exemptions, please visit the Department’s Employer Guide to MAPFML.

Substitution of Employer-Provided Paid Leave

The revised regulations state that employees may choose to use accrued paid leave provided by their employer rather than applying for the MAPFML benefit.  The regulations additionally state that employees may not be compensated with MAPFML benefits for a period of time for which the employee is receiving compensation through the use of accrued paid leave.  This language creates another perplexing issue for employers: are employers entitled to require eligible employees to first apply for MAPFML benefits before being entitled to an employer-provided paid leave?  For example, can an employer create a paid parental leave that grosses up an employee’s pay to 100% after requiring the employee first applies for MAPFML benefits?  The revised regulations are unclear on this question.

Conclusion

While the revised regulations provide clarity in some respects, they are not yet final and s unanswered questions remain.  The Department will continue to solicit feedback from the public on the regulations, which will be finalized on the first day MAPFML goes into effect. The Department has published a significant amount of useful materials to help employers better prepare for the upcoming effective date of the law, including a contribution rate calculator, MAPFML timelines and graphics explaining the breakdown of family and medical contributions. 


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National Law Review, Volumess IX, Number 101