Counties to State: More Details, Assistance are Needed to Plan for Paid Leave Program

The Maryland Association of Counties and local government partner organizations are urging the Department of Labor to expedite guidance on the 2022 paid family and medical leave law ahead immanent implementation deadlines.

During the 2022 legislative session, the General Assembly established the Family and Medical Leave Insurance Program (FAMLI Program) via legislation known as “The Time to Care Act of 2022.” That law provides up to 12 weeks of paid leave and benefits to an employee in Maryland who takes leave from employment for certain eligible medical and family care reasons.

According to the law, the Maryland Department of Labor (MDL) must implement the program and complete initial study and program development requirements before contributions to the program begin on October 1, 2023, and claims for benefits begin on January 1, 2025. Notably, the MDL is to recommend key details of the program like employer/employee contribution rates by June 2023.

Every Maryland county, as an employer, will be legally required to participate in the program or to seek an exemption from the State if the county provides an equal benefit. However, many details remain as to how local governments should implement the law and the process to seek an exemption from the FAMLI Program via offering an equal benefit.

On December 19, the Maryland Association of Counties (MACo), in conjunction with the Maryland Municipal League (MML), the Maryland Association of Boards of Education (MABE), and the Public School Superintendents Association of Maryland (PSSAM) sent MDL leadership a letter outlining these ongoing concerns and open questions about the implementation and requirements of the program.

That letter states:

The current timeline requires the Department of Labor to submit final recommendations for regulations for the establishment and operation of the statewide paid leave insurance fund by June 2023. Subsequently, employer and employee contributions are set to begin in October 2023, with the benefit starting January of 2025.

This means that local governments will not know many of the critical details of the law and requirements of its implementation – including the mandatory employer and employee contribution rates – until June, but will need to have a program fully built out and ready to start collecting contributions only four months later by October. Similarly, entities that plan to seek an exemption from the Department of Labor by offering an equal or superior benefit will only have four months from learning the legal requirements of the law to establish an alternative benefits program, submit that plan for approval from the Department, and ready the program for contributions. 

In addition to establishing the benefit program, employers will need to procure technology platforms and systems capable of managing the contributions, consider the cybersecurity of said tools, develop communications and education campaigns to explain the new benefit to staff, and create enrollment plans – all ahead of the October contribution startup. 

It continues:

Not only is this logistically challenging, but also is potentially impossible for local governments to navigate. Some counties, for example, will be required to seek approval from their governing body to establish the new benefit, plus budgetary approval to fund employer contributions and any costs associated with establishing and implementing the benefit. Likewise, local boards of education may have to seek comparable support from county governments. 

Furthermore, the current timeline is surely not sufficient for the Department of Labor to adequately consider and rule on said applications for exemption.

MACo and its partner signatories also posed a series of questions for the MDL to answer ahead of the June 2023 regulatory recommendations due date, including whether or not the Department could provide details on exemption processes ahead of June so employers can prepare applications. Those questions include:

  • Will the Department provide any insight into pending regulations, especially related to the undetermined benefit details like contribution rates and benefit eligibility for part-time jointly hired employees ahead of the June 2023 deadline to help inform our planning?
  • Will the Department provide more information on the exemption options ahead of the June regulatory deadline?
  • Will the Department provide an expedited application to address the timeline logistical concerns mentioned in this letter?   
  • What can employers expect regarding the turnaround time from application to Department decision?
  • If the Department does not plan to publish the above requests ahead of June 2023, will it be possible to provide local governments with advanced notice of the critical items discussed in this letter? 

Stay tuned to Conduit Street for more on this issue and others.

Read the full MACo letter.