Good Evening
Good Evening

The ins and outs of New York State’s new paid-time off law

Jessica Moller, an employment lawyer and a partner

Jessica Moller, an employment lawyer and a partner at Bond, Schoeneck & King in Garden City, on Sept. 1, 2017. Credit: Daniel Goodrich

Nearly all private-sector workers in New York State will soon be able to take paid leave to care for a newborn or a seriously ill family member.

The state’s Paid Family Leave law, long sought by workers and their advocates, takes effect Jan. 1. It will give qualified workers up to eight weeks off at 50 percent of their average weekly wage, with the maximum increasing to 12 weeks at 67 percent when the law is fully implemented in 2021. Amounts are subject to a state wage cap.

As of July 1 of this year, employers could start deducting from employees’ pay for the benefit.

In 2014 New York City began inching in the direction of a similar benefit with a law that requires employers to give their employees up to 40 hours a year of paid sick days to tend to a personal or family illness. And some companies, such as Facebook, have made headlines because of their generous paid time-off policies. The California-based tech giant offers four months of paid leave to new parents and gives employees as many as six weeks to tend to ailing relatives.

The new statute, signed into law in April 2016, will affect New York companies of all sizes, even those with just one employee.

“It’s definitely far-reaching,” said employment attorney Carmelo Grimaldi, a partner at Meltzer, Lippe, Goldstein & Breitstone in Mineola.

Such leaves were previously unpaid under the federal Family and Medical Leave Act, which President Bill Clinton signed into law in 1993. The FMLA applies to companies with at least 50 employees. Most Long Island companies are exempt from that measure, because 90 percent of the Island’s nearly 97,000 businesses have fewer than 20 employees.

While the FMLA’s definition of family includes spouse, children and parents, the state law extends the definition to include domestic partners, parents-in-law, grandparents and grandchildren.

But in at least one respect the state law is narrower than its federal counterpart. It doesn’t grant workers time off to deal with their own health problems.

Newsday sought answers from employers, attorneys and officials of payroll and insurance companies to the most frequently asked questions regarding the complex new law.

What companies are covered?

Private-sector employers with even just one employee.

“Virtually all private-sector employers are going to be affected by this law,” said employment attorney Jessica Moller, a partner at Bond, Schoeneck & King in Garden City.

Many local small businesses are surprised to learn that, given that most are exempt from the FMLA.

“Probably the most common question that has been posed at the outset [by employers] is ‘Does this law apply to me?’ ” Moller said.

Employment attorney Kimberly Malerba, a partner at Ruskin Moscou Faltischek in Uniondale, said small businesses “are extremely concerned about the impact of having to hold employees’ jobs open for eight [and eventually 12] weeks.”

Which employees are eligible?

To qualify for a leave, private-sector employees in New York must have worked at least 20 hours a week for 26 consecutive weeks, or for 175 days if they work fewer than 20 hours a week. Under FMLA, employees have to work a whole year and accumulate at least 1,250 hours to qualify, Moller said.

Public-sector employers may opt into the program, Malerba said. And unionized public workers are covered if their collective bargaining agreement includes the leave.

Some employees could be eligible for a leave as soon as the law takes effect on Jan. 1, some experts said.

Who is exempt?

The exemptions include public-sector employees and seasonal and temporary employees who don’t meet the day and hour thresholds, Moller said.

“Those employees can be exempted from this law so that they don’t have to contribute to the cost by payroll deductions,” she said.

What are the benefits?

Eligible employees can receive as many as eight weeks off, as of Jan. 1. The maximum leave rises to 10 weeks in 2019. It changes for the final time in 2021, when employees may take up to 12 weeks off.

As of Jan. 1, eligible employees can receive 50 percent of their average weekly pay or no more than 50 percent of the state average weekly wage, which is determined each year by the New York State Department of Labor, the statute says. That salary benefit will rise each year before reaching the maximum of 67 percent of an employee’s weekly salary in 2021, or no more than 67 percent of the state average weekly wage. The state average weekly wage for 2016 was $1,305.92; the 2017 average has not been set yet.

Under that scenario an employee who makes $1,000 a week would receive a $500 a week paid leave benefit, the state says. Someone earning $2,000 a week would receive $652.96, or half of the state’s current average weekly wage.

Who pays?

“The state law allows employers to pass the cost of this statute to employees through deductions,” said Grimaldi of Meltzer Lippe.

Employees will pay 0.126 percent of their weekly wages, or a maximum of 0.126 percent of the state average weekly wage. An employee who makes $800 a week, as a state example shows, would have to pay about $1 a week in deductions.

Currently, the maximum deduction would be $1.65 a week, or 0.126 percent of the latest state average weekly wage.

What triggers eligibility for employees?

The law covers employees who need to spend time caring for a “close relative” with “a serious health condition.” The statute defines a serious health condition as “an illness, injury, impairment or physical or mental condition that involves inpatient care in a hospital, hospice or residential health care facility or continuing treatment or continuing supervision by a health care provider.”

The leave is also available for employees whose spouse, child, domestic partner or parent in the military has been called to active duty, with the workers needing time off for such things as taking care of financial arrangements for the deployed relative.

Unlike the FMLA, the new state law does not allow employees to use the leave to deal with their own illnesses. For that New York has workers’ compensation and disability benefits, Grimaldi said.

“You can look to those statutes for benefits if you have your own serious health condition,” he said.

How do companies get coverage?

Companies will use the funds from payroll deductions to pay for insurance to cover the costs of their employees’ paid leaves. The coverage “will typically be added” to an employer’s existing disability insurance policy, the state says. It advises employers to contact their current disability benefits insurance carriers.

“Paid Family Leave is basically tacked onto disability benefits law,” said Brian Dunham, chief actuary for Garden City-based ShelterPoint Life Insurance Co., which bills itself as one of the state’s largest providers of disability insurance.

As with the new law, New York companies with even just one employee must have disability insurance to provide benefits to employees unable to work because of non-job-related injuries or illnesses. That program’s maximum weekly benefit is $170. And similar to the disability benefits program, Paid Family Leave will fall under the jurisdiction of the state Workers’ Compensation Board.

If employers obtain disability insurance through the New York State Insurance Fund, “Paid Family Leave insurance will be automatically added,” said Yvette Hector, vice president of Associated Human Capital Management, a Hauppauge company that provides payroll and human resources services.

Some employers are concerned about whether their insurers will remain in business because “a number of insurance carriers have left the market,” said Matt Wood, a Florida-based vice president of sales and technology at LiDAC, a Great Neck company that links brokers and insurance companies.

Employers that self-insure their disability claims “may want to consider looking for a policy through an insurance carrier to help them alleviate some of the risk” of Paid Family Leave, Malerba said.

Does the law protect the jobs and benefits of employees on leave?

As with the FMLA, employers must continue employees’ health insurance and can require employees to continue to pay their insurance premiums, Grimaldi of Meltzer Lippe said. After the leave, employers must reinstate employees to the “same or a comparable job,” he said.

Does Paid Family Leave have to be taken all at once?

No, the leave can be taken a week at a time or even a day at a time.

The smallest increment of time off a worker will be charged is a day, even if he or she uses just four hours, Grimaldi said.

By contrast, for intermittent leave under the FMLA, an employer can charge workers only for their actual time away from work. But for FMLA leaves of less than one hour, an employer may charge an hour.

Does New York’s Paid Family Leave Act run concurrently with the FMLA?

“There is overlapping, but there is also the possibility that you will get no overlaps,” Grimaldi said.

If an employee is covered under both statutes and needs to take time off to care for an ailing mom, for example, the leaves would run concurrently because both cover care for a seriously ill parent, he said.

But if an employee takes the maximum 12 weeks of FMLA leave for her own serious health condition, she would not have exhausted any of her Paid Family Leave, and thus, could qualify in the same year for up to eight weeks under this statute to care for an ailing parent, Grimaldi said.

“The employee would receive 20 weeks,” he said.

That remains a point of confusion among many managers, said Gary Barello, senior vice president of human resources at Biodex Medical Systems Inc., a Shirley-based company that makes rehabilitation equipment and tables for diagnostic procedures.

The leave “can easily go beyond 12 weeks, and a lot of people don’t understand that,” he said.

Must employees exhaust their paid time off as part of the Paid Family Leave?

No, they don’t have to. Workers can be required to use accrued paid time off under the FMLA but not under the state law. .

“An employer may permit you to use sick or vacation leave for full pay, but may not require you to use this leave,” the regulation says.

More news