Proposed Updates to Paid Leave Law Would Give Counties More Time to Prepare

The Senate has passed a “fix it” bill to adjust key provisions of the 2022 paid leave law, including its timeline for implementation and contribution rates. 

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 with 15 or more employees, 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, 2022, 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.

Proposed Updates to the Law and their Impacts on Counties

The General Assembly, aware of the ongoing concerns and unanswered questions about the FAMLI Program are actively considering a “fix it” bill during the 2023 legislative session: SB 828 – Family and Medical Leave Insurance Program – Modifications.

Ahead of “Crossover Day,” the Senate passed an amended SB 828 to modify the FAMLI Program, passed in 2022, by clarifying and altering provisions related to the administration of the Program. The amended bill takes care of county concerns related to employer implementation of the benefits program. The bill’s crossfile, HB 988, has not moved from the House Economic Matters Committee, indicating that the General Assembly is likely to just update the FAMLI Program law via the Senate bill.

Notably, MACo, MABE, PSSAM, and MML all requested the same set of amendments to SB 828 to further pushback the implementation timeline to better align with the budget year and budgetary processes and to clarify the equal benefit private plan opt-out application process and guidelines.

The Maryland Department of Labor requested similar amendments, with an even more generous extension to the timeline so that it could properly staff and set-up the benefits program. Ultimately, the Senate accepted the Department’s amendments, in-turn taking care of county concerns and MACo’s requested amendments.

As amended, SB 828 would do the following:

  • Sets contribution rates at 50/50, splitting contributions equally between employees and employer;
  • Requiring the Department of Labor to publish regulations (including those governing the equal benefit private plan opt-out application process) by January 2024 (originally July 2023); and
  • Pushing back the start of contributions from from October 1, 2023, to October 1, 2024.

In doing so, SB 828 as amended would give counties 10 months to plan to implement the State FAMLI Plan or apply for an equal benefit private plan opt-out.

Stay tuned to Conduit Street for future updates on SB 828 and the paid leave benefits law.

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