PFML Contributions 2023
All Massachusetts Employers, including those with private or self-insured benefits plans, are required to distribute certain information to their employees regarding their rights under the paid Family and Medical Leave (PFML) Act. The Department of Family and Medical Leave (DFML) has announced updates to the required contribution rate and maximum benefits amounts under PFML. During 2023, the maximum weekly PFML benefit amount which eligible employees may receive will be $1,129.82 per week. This is an increase from the 2022 maximum benefit amount.
Employers must display a workplace poster prepared by the Department of Family and Medical Leave (DFML) that explains the benefits available to employees under PFML law, the poster should be displayed in a location where it can be easily read, such as a break room. Posters and notice forms, effective January 1, 2023, can be downloaded at: https://www.mass.gov/info-details/pfml-workforce-notifications-and-rate-sheets-for-massachusetts-employers
For the purposes of the PFM, eligible wages include the below. Please be aware that this list is not exhaustive:
- Salaries, hourly pay, and stipends
- Cash tips of more than $20 and non-cash tips
- Commissions and bonuses
- Overtime, vacation, or sick pay
- 401K employer contributions
Employers with More Than Twenty-Five Employees
Overall, the PFML contribution rate has decreased from 0.68% to 0.63% of eligible wages for employers with more than twenty-five employees. The 0.63% contribution rate is split between required medical leave contribution of 0.52% and a family leave contribution of 0.11% of an individual’s eligible wages. Employers may withhold up to 0.11% of eligible wages for an individual’s family leave contribution and up to 0.208% of eligible wages for an employee’s medical leave contribution. Employers must contribute the remaining 0.312% of eligible wages on behalf of employees for medical leave (i.e., the employer share).
Employers with Less Than Twenty-Five Employees
The PFML contribution rate for smaller employers – fewer than 25 covered individuals – decreased from 0.344% to 0.318%. The 0.318% contribution rate is split between medical leave contribution of 0.208% and family leave contribution of 0.11%. Employers may withhold the entire contribution from an individual’s eligible wages. Unlike larger employers, smaller employers are not required to contribute towards an individual’s medical leave contribution amount.
Employers must provide any new employee with a notification form detailing the PFML contribution rates within 30 days of hire. The notice can be provided in paper form or electronically. The notice must include the opportunity for an employee to accept or decline receipt of the information. Each employee should return a signed form, or the employer needs to be able to show their effort to give the information to the employee. The forms are kept internally per the business’s document retention policy, they are not sent to the DFML. The forms should be placed in the employee’s personnel file.
For current employees who have previously signed a form, employers must provide information on the new contribution rate 30 days in advance of the rate change. The notice may be provided electronically and does not require an updated signature.
These changes will be effective as of January 1, 2023. Employers should ensure that their PFML policies and payroll systems reflect these changes. Employer’s using a third-party payroll provider should contact them to make sure they will be making the appropriate deductions per the contribution amounts.
By: Nicholas A. Rossini, Esq Michael P. Doherty, Esq; and Gabriel W. Bell, Esq.;.
This blog is for informational purposes only. It should not be considered legal advice. All those who read this blog should seek the advice of a professional before taking action based upon any information provided herein.
© 2022 Doherty, Dugan, Cannon, Raymond & Weil, P.C.