State Sets Contribution Rates for FAMLI Paid Leave Benefit

The Department of Labor has set the FAMLI contribution rate at .9%.

As part of its draft regulatory process for the state’s new Family and Medical Leave Insurance (FAMLI) benefit program, the Maryland Department of Labor (MDL) has set contribution rates and has provided guidance on the split between employers and employees.

MDL has set the initial contribution rate for the FAMLI State Plan as 0.90% of covered wages, to be equally divided between employees and employers with 15 or more workers. That contribution rate is the rate applicable to employers and self-employed individuals choosing coverage under the State Plan.

Employers may choose coverage under the State Plan, under an approved commercially insured plan sold by insurers in the state, or under an approved self-insured plan. MACo and the Maryland Association of Boards of Education (MABE) have collaborated to form a new co-operative offering for members seeking to streamline the administration of FAMLI benefits under an Equivalent Private Insurance Plan (EPIP).

Employers participating in the State Plan (not the MACo/MABE collaborative) will begin making contributions on wages paid to employees starting October 1, 2024. The total rate of 0.9% of covered wages up to the Social Security wage base (currently $160,200) will be evenly split between employees and employers, who will each contribute 0.45%. Small businesses with 14 or fewer employees are exempt from the employer’s portion of the contributions. Employees of those small businesses will continue to contribute their 0.45% share.

According to a press release, the Department’s rate decision was informed by a comprehensive cost analysis of the Family and Medical Leave Insurance system prepared by the Jacob France Institute at the Merrick School of Business at the University of Baltimore and an actuarial report from Milliman, Inc.

Starting in 2026, Maryland workers will receive job protection and up to $1000 a week for up to 12 weeks to take time away from work to care for themselves or a loved one, to bond with a child, and for certain military-related events. The contribution rate announced today will continue through at least June 30, 2026.

Learn more about the MACo/MABE co-operative.