United States: Massachusetts Governor Signs Law Establishing Paid Family And Medical Leave Program, Increasing Minimum Wage, And Eliminating Sunday/Holiday Premium Pay

Last Updated: July 9 2018
Article by Gauri P. Punjabi

On June 28, 2018, Massachusetts Governor Charlie Baker signed a law affecting all employers in the Commonwealth by creating a paid family and medical leave program funded by a state payroll tax, increasing the state minimum wage, and eliminating premium pay requirements for work performed on Sundays and certain holidays.

To avoid November ballot questions initiated by multiple interest groups, last week the state legislature passed the "Grand Bargain" legislation addressing these issues, which Governor Baker signed without any changes. The new law has several significant changes in store for employers over the next 5 years.

Paid Family and Personal Medical Leave

Beginning in 2021, eligible employees will be allowed to take the following leave in a benefit year (defined as the 52-consecutive week period beginning on the Sunday preceding the first day the protected leave begins):

  • Up to 20 weeks of job-protected paid medical leave to care for their own serious health condition;
  • Up to 12 weeks of job-protected paid family leave to care for a family member with a serious health condition, to bond with the employee's child during the first 12 months after the child's birth or the first 12 months after the placement of the child for adoption or foster care with the employee, or because of any qualifying exigency arising out of an employee's family member being active duty or notification of an impending call or order to be in the Armed Forces; and
  • Up to 26 weeks of job-protected paid family leave to care for a covered servicemember.

An employee may not take more than 26 weeks in the aggregate in a benefit year. To be eligible for paid family and medical leave, an employee must meet the financial eligibility requirements for receiving unemployment compensation under Massachusetts law (which currently is to have earned 30 times the weekly unemployment benefit amount the employee would be eligible to receive and earned at least $4,700 during the last four calendar quarters).

There will be a 7-day waiting period before leave can be used, except where an employee seeks to take medical leave during pregnancy or recovery from childbirth and the need for such leave is immediate and supported by documentation from a health care provider. During the 7-day waiting period, employees may use accrued sick leave or vacation pay or other paid leave. After returning from leave, employees must be restored to the same or equivalent positions that they previously held. Employers will be required to post a notice, and provide all new employees within 30 days of their hire with notice of benefits under the statute

The weekly paid family or medical leave benefit amount will be equal to (i) the portion of the employee's average weekly wage that is equal or less than 50% of the state average weekly wage (currently $1,338.05) replaced at the rate of 80%, plus (ii) the portion of the employee's average weekly wage that is more than 50% of the state weekly wage replaced at 50%. The maximum weekly benefit amount will be $850 per week, adjusted annually to remain at 64% of the state average weekly wage. Weekly benefits will be reduced by the amount of wages or wage replacement received under a government program or law (such as workers' compensation) other than for a prior permanent partial disability, or the employer's permanent disability policy or program. Weekly benefits may not be reduced, however, by wage replacement received under an employer's temporary disability policy or paid family or medical leave policy, unless the aggregate amount would exceed the employee's average weekly wage.

The state leave program will be funded through a payroll tax of 0.63% (which will be adjusted annually) split between employers and employees. Employees will be required to cover 100% of the contributions for family leave and 40% of the contributions for personal medical leave. Employers with over 25 employees will be responsible for paying 60% of the contributions for personal medical leave. While employers with 25 or less employees will not have to cover the employer portion of contributions, they will still be required to deduct the payroll tax from employees' wages. Employer and employee contributions will begin on July 1, 2019, with benefit payments beginning on January 1, 2021 for personal medical leave and on July 1, 2021 for family leave benefits. Employers may opt out of the state program if they provide benefits that match or exceed those provided by the state plan.

Paid family and medical leave will run concurrently with leave taken under the Massachusetts Parental Leave Act and the federal Family and Medical Leave Act (FMLA). An employee who takes leave under the Massachusetts law while ineligible for FMLA leave may still take FMLA in the same benefit year but only to the extent the employee remains eligible to do so. An employer may require an employee to take paid family and medical leave concurrently with disability or family care leave under a collective bargaining agreement or employer policy such that the employee can receive the greater of the available benefits.

Growing Trend

Massachusetts' establishment of a paid family and medical leave program – the most generous in the country so far – comes on the heels of a similar New York state program funded by employee contributions that went into effect on January 1, 2018, and which we previously blogged about here. The New York State Paid Family Leave Law provides employees with up to 8 weeks (and eventually 12 weeks) of partially-paid, fully job-protected leave and, unlike the Massachusetts law, requires employees to work at least 20 hours per week after 26 weeks of employment before they become eligible for paid leave.

California, New Jersey and Rhode Island also offer paid family and medical leave through state programs funded by payroll taxes. Under the California and New Jersey Paid Family Leave statutes, employees can take up to 6 weeks of partially-paid leave, while under the Rhode Island Temporary Caregiver Insurance Program, employees may take up to 4 weeks of partially-paid family leave and up to 30 weeks of partially-paid leave for their own disability.

Increased Minimum Wage, Elimination of Premium Pay by January 1, 2023

Under the new law, starting on January 1, 2019, and gradually over the following five years: (1) the state hourly minimum wage will rise from $11.00 to $15.00; (2) the tipped hourly minimum wage will increase from $3.75 to $6.75; and (3) the premium pay (1.5 times the hourly rate) requirement for work performed on Sundays and certain holidays will be completely eliminated.

Next Steps

While there are no imminent deadlines for employers under the new law, employers should start reviewing their payroll systems and/or discussing with their payroll providers (e.g., ADP, Paychex, etc.) to make sure they will have the mechanism in place to make the required deductions from employee payroll, as well as consider changes that may need to be made to their current employee leave policies. It is also likely that more employees will utilize leaves, so employers should start thinking about ways to address the challenges of managing workload while an employee is out on leave, such as hiring temporary replacements and temporarily assigning work to other employees. Employers should also start reviewing employee positions to determine which employees will need to receive wage adjustments come January 1, 2019. The state has not published any guidance on the law, but will likely do so in the upcoming months. Stay tuned.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
Similar Articles
Relevancy Powered by MondaqAI
BakerHostetler
 
In association with
Related Topics
 
Similar Articles
Relevancy Powered by MondaqAI
BakerHostetler
Related Articles
 
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions