Types of plans eligible for exemptions
The Department of Family and Medical Leave (DFML) and the Massachusetts Division of Insurance (DOI) are working with insurance carriers to develop tools to more easily determine whether a private Paid Family and/or Medical Leave (PFML) plan satisfies PFML requirements in order to exempt an employer from the state plan. Additionally, the DFML has refined its internal review process to be more responsive to private plan submissions and evaluate plans more efficiently.
There are two types of plans that can qualify for an exemption:
A fully insured PFML private plan offered by an insurance carrier licensed by the DOI
A self-insured plan funded by an employer (which may be administered by a third-party administrator)
Standards for PFML Fully Insured Private Plans
The DFML and the DOI are working with insurance carriers to develop a standardized template that all carriers can use to demonstrate that the plan is consistent with PFML requirements. In the interim, the DFML will consider a carrier-issued Declaration of Insurance as acceptable proof of family and medical leave coverage consistent with the DFML standards.
DOI Acknowledged Insurance Carriers
The DOI has published a list of insurance carriers who are able to provide a PFML Declaration of Insurance that has been reviewed and meets DFML standards. This list will continue to be updated.
Employers who intend to apply for an exemption (or have been provisionally approved for an exemption) should consult with their insurance carrier to obtain the required Declaration of Insurance to add to their exemption application file by Dec. 20, 2019. Both a representative of the employer and a representative of the insurance carrier must sign this document (electronic signatures are acceptable). Insurance carriers will issue a full PFML policy form once this document is submitted and reviewed by the DOI.
Please note that most long-term and short-term disability insurance policies do not meet the PFML requirements to qualify for a medical leave exemption. To be approved for an exemption, a private plan must confer all the same or better benefits to its workforce, as those required by M.G.L. c. 175M. Section 11.
In addition to the same benefits, the private plan must provide equivalent or better rights and protections as those specified in M.G.L. c. 175M. Sections 2 and 9.
Applying for an exemption
If you're an employer who is interested in getting an exemption from contributing to family leave, medical leave, or both, you will need to submit an annual approved plan application to the Department of Family and Medical Leave (DFML). The electronic approved plan application is available through MassTaxConnect.
The benefits provided by your approved plan must be greater than or equal to the benefits provided by the PFML law to be granted an exemption. This means your approved plan must meet all the minimum requirements and must not cost your covered individuals any more than they would be required to contribute to the state plan under the PFML law.
The deadline to file for a private plan exemption for first quarter contributions is Dec. 20, 2019.
The Department will continue to accept applications on a rolling basis but applications must be approved in the quarter prior to the quarter in which they go into effect.
Employers applying for an exemption will receive an email notification within 1-2 business days indicating that a determination has been made. Once you've received the notification, you can log into MassTaxConnect to review the decision.
- If the exemption is approved, you'll receive a letter with instructions listing the steps you should take next. Self-insured plans will also need to provide a surety bond running to the Commonwealth of Massachusetts.
- If the exemption is denied, you'll be notified why it was denied. If you disagree with the basis for denial, you may request a follow-up review.
If you're granted an exemption because your approved plan offers benefits that match or exceed those provided under the state's program, your covered individuals will still be entitled to rights and protections. This includes:
- The right to an appeal if their application for benefits is denied
- The right to job protection during any leave taken
- Protections against retaliation from taking leave or exercising other rights under the PFML law
Exemption Effective Dates
If you apply for an exemption on or before December 20, 2019 and are approved, your exemption effective date will be October 1, 2019. This retroactive approval is only applicable to October 1, 2019 PFML exemption applications.
For exemption applications submitted on or after December 21, 2019, your exemption effective date will be the first date of the quarter immediately following approval. For example, if you are approved on December 28, 2019, your effective date will be January 1, 2020. If you are approved on March 1, 2020, your effective date will be April 1, 2020. Surety Bonds should have the same effective date as your exemption application.
If you are applying for an exemption after September 30, 2019 (the deadline for PFML workforce notifications), you should provide information to your workforce about the PFML state plan contribution rates, even if you plan to have an exemption effective October 1, 2019. Learn more about informing your workforce about PFML.
You may also wish to notify your workforce that you are in the process of applying for a private plan exemption and that the details of the private plan will be distributed if you are eventually approved. If you are approved for an exemption after September 30, 2019, you must re-notify your workforce about the terms and conditions of your private plan and any changes to employee and employer contributions.
|Last updated:||June 14, 2019|