As a Massachusetts employer, you likely going to have new responsibilities under the Paid Family and Medical Leave (PFML) law. Learn more about those responsibilities as of the law's effective date of Oct. 1, 2019, through the first quarterly reporting due by Jan. 31, 2020, and into the future.
Step 1: Learn about Massachusetts' Paid Family and Medical Leave
Read about PFML to learn more about what it is, how it works, what it covers, your responsibilities, and how PFML is different from the Family and Medical Leave Act (FMLA). It is especially important to know who's a covered individual and whether your company or organization is among those that are automatically excluded from making PFML employer contributions.
Step 2: Hang up your PFML poster
All Massachusetts employers must display a workplace poster prepared or approved by the Department of Family and Medical Leave (DFML) that explains the benefits available to your workforce under the PFML law.
You must post this poster at your workplace in a location where it can be easily read. We suggest you place the poster alongside other mandatory workplace posters you've displayed, like wage and hours laws, workplace discrimination, worker's compensation, and workplace safety.
The poster must be available in English and each language which is the primary language of 5 or more individuals in your workforce if these translations are available from DFML.
Additional Resources for Step 2: Hang up your PFML poster
Step 3: Calculate your covered individuals & financial responsibility
To determine what contributions you are required to submit, you will first need to calculate how many covered individuals are in your workforce. There are three steps in this process, and you can use the PFML online calculator to help you determine your responsibilities as an employer.
1: Determine your 2018 workforce
Your contribution responsibilities depend on your average number of covered individuals from the previous calendar year (Jan. 1 - Dec. 31), which is why you're looking to last year's MA workforce numbers.
Determining your 2018 Massachusetts workforce count will help you answer 2 important questions when it comes to your 2019 contribution responsibilities:
- Whether or not your 1099-MISC contractors are considered covered individuals.
- Whether or not you're responsible for paying a share of the contributions.
Your contribution responsibilities depend on your average number of covered individuals from the previous calendar year (Jan. 1 - Dec. 31), which is why we're looking to last year's MA workforce numbers.
W-2 employees are always covered individuals. 1099-MISC contractors are only covered individuals if they made up more than 50% of your workforce and meet certain criteria.
Counting your MA workforce
- Add up the total number of MA W-2 employees you paid each pay period in 2018 and divide that number by the number of pay periods. This is your 2018 MA W-2 average.
- Add up the total number of MA 1099-MISC contractors you paid for services each pay period in 2018 and divide that number by the number of pay periods. This is your 2018 MA 1099-MISC average.
- If your 2018 MA 1099-MISC average is greater than your W-2 average, then they are considered covered individuals.
- Add up your total number of covered individuals in 2018.
If you had 25 or more covered individuals in your workforce for 2018, then you are responsible for making employer contributions for covered individuals in your 2019 workforce.
If you had less than 25 covered individuals in last year's workforce, you do not need to make an employer contribution this year. However, you will still need to remit the employee portion of the contribution on their behalf.
Read more about who qualifies as a covered individual in order to make an accurate workforce count.
2: Calculate your financial responsibilities
Now that you know who's a covered individuals this year, you can determine what employer contributions you are responsible for.
Even if you are not required to pay an employer contribution, you will be required to remit the worker's contribution to the state on their behalf. You can also elect to cover up to 100% of the employee contribution, regardless of your obligation.
Our PFML calculator can help you determine what amount you need to contribute or remit.
Step 4: Apply for an exemption if you have a qualifying private plan
If you offer a qualifying private plan to your workforce with benefits greater than or equal to the benefits provided by the PFML law, you can apply for exemption. Self-insured employers must provide a bond even if granted an exemption.
Certain employers are already automatically excluded from PFML requirements. If you are an excluded employer, you do not need to apply for an exemption.
Step 5: Notify your covered individuals in writing of PFML law and benefits
You are required to provide written notice to your current covered individuals. This is in addition to hanging a poster in your workplace. This notification must include information about:
- PFML Benefits
- Covered individual contribution rates
- Employer contribution rates (if applicable)
- Job protections
- Other provisions as outlined in M.G.L. c. 175M sec. 4
Note: Please use your Federal Employer Identification Number (FEIN) as your Employer ID Number on the “Employer Notice to Employee” and the “Employer Notice to Self-Employed Individual” Forms.
These notices must be written in the covered individual's primary language. DFML has provided some translated versions.
The notice, which may be provided electronically, must include the opportunity for an employee or self-employed individual to acknowledge receipt or decline to acknowledge receipt of the information. The employer can receive these acknowledgments in paper form or electronically.
In the event that an employee or self-employed individual fails to acknowledge receipt, the Department shall consider an employer to have fulfilled its notice obligation if it can establish that it provided to each member of its current workforce notice and the opportunity to acknowledge or decline to acknowledge receipt.
If less than 50% of your workforce includes MA 1099-MISC contractors, you're not required to inform them of PFML benefits, though it's encouraged so those contractors are aware they may opt-in.
Step 6: Make payroll withholdings based on contribution rates
Oct. 1, 2019 marked the beginning of the first quarter of payroll and wage withholdings. These withholdings, and in some cases employer payments, will be remitted to DFML 30 days following the conclusion of each calendar quarter. They began with the first payment made on or after Oct. 1, 2019. Therefore, the withholdings could be for services rendered in September but paid for in October.
Additional Resources for Step 6: Make payroll withholdings based on contribution rates
Step 7: By Jan. 31, 2020, complete quarterly filings and submit contributions through MassTaxConnect
You'll need to complete your quarterly report and submit contributions on your covered individuals for the previous calendar quarter (October - December) through MassTaxConnect.
For self-employed individuals
As a self-employed individual, you aren't required to participate in the state's PFML program. However, you may choose to opt-in and purchase coverage. If you do so, you will be responsible for paying the full 0.75 percent contribution rate for both family and medical leave.
Learn more about PFML for self-employed individuals.