NOTE and DISCLAIMER: The following information, including any calculations required herein, are not intended, nor should be interpreted as legal advice. Massachusetts employers should not rely on these or any calculations when determining PFML other than those which come directly from the state. A Massachusetts employer or employee should contact a professional skilled in these calculations. Contact 978-273-8337 for more information or assistance in these matters as an attorney-client relationship is not formed through the reading, interpretation or use of the information on this webpage.
Massachusetts employers must be aware of the Paid Family Medical Leave (PFML) program when operating a business within Massachusetts. PFML is a program funded by contributions made by Massachusetts employers and employees which covers up to 26 weeks of time off for medical or family leave. To qualify for PFML, the employer must be the type of employer required to participate, the employee must be eligible, and the time off must be for the purpose of medical or family reasons.
PFML is different from benefits which an employee may receive under the Family Medical Leave Act, a federal program which provides for unpaid leave for employees under certain circumstances.
Steps for Massachusetts Employers
Step 1 – Determine which employees are considered covered individuals under PFML
First, calculate the total number of Massachusetts W-2 employees.
Next, calculate your total workforce according to the definition of workforce as applied to PFML.
By looking back at the previous calendar year, add the total number of Massachusetts W-2 employees paid each pay period and divide by the total number of pay periods. Then, determine the number of Massachusetts 1099-MISC contractors that your business paid during the previous calendar year and divide that number by the number of applicable pay periods. If the 1099-MISC average exceeds the W-2 average, then you must add all 1099-MISC contractors to the total number of Massachusetts W-2 employees. If the 1099-MISC average is less than the W-2 average for your business you do not have to count 1099-MISC contractors as covered individuals.
Lastly, if after completing the calculations described above you have 25 or more covered individuals working for your business last year, you must make employer contributions for those individuals. If, however, your business had less than 25 covered individuals working last year, you will not need to contribute to the PFML program as an employer this year. However, your payroll department must still submit to Massachusetts the employee’s portion via MassTaxConnect.
Note: while it is the employee’s pay that is reduced to make contributions to PFML owed by each employee, a Massachusetts employer may choose to make the contribution on the employee’s behalf, however, doing so is completely voluntary.
Also note that these calculations can be confusing and may require the assistance of an accountant or other professional skilled in these matters. Contact our offices for more information at 978-273-8337.
Step 2 – How Much Does My Business Have to Pay to PFML?
If you have 25 or more covered employees, your business must make contributions to Massachusetts under PFML for those employees. The state of Massachusetts has created a chart which is useful in determining the exact amount that employers must contribute to PFML; the cart is available here on page 7.
The chart referred to above breaks down as follows:
For Massachusetts businesses which must pay into PFML, contributions are made to either or both family and medical leave. Family leave contributions are not required by the employer, it is only the employee that must contribute 0.13% of eligible wages to family leave under PFML. Medical leave contributions are required to be made to PFML by the Massachusetts employer at 60% of 0.62% of eligible wages (the employee contributes the other 40%).
Note: an employer in Massachusetts may voluntarily pay a larger portion than that required under the PFML, for example, an employer may wish to pay 100% of the 0.62% of eligible wages, but it is not required to do so.
Step 3 – PFML Notification Requirements
Massachusetts employers must display a workplace poster regardless of whether or not the employer must make contributions to the PFML program. Please note that Massachusetts also requires a poster in languages other than English where that language represents the primary language spoken by 5 or more employees of the business.
For 1099-MISC employees as well as W-2 employees, a notice must be issued to each employee within 30-days of the date of hire. This notice should detail each employee’s acknowledgment of or refusal to acknowledge the notice.
DISCLAIMER:
The information provided in the pages and posts of this website are for general informational purposes only. The information presented on this site is not legal advice, and no attorney-client relationship is formed by the use of this site.
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