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Massachusetts Paid Family & Medical Leave (PFML) Summary

John T. Lally

September 20, 2019

By September 30, 2019, you must notify your entire workforce of the PFML law by:

Posting the Paid Family and Medical Leave Workplace poster on your premises.  Providing written notice of contributions, benefits, and workforce protections to all covered individuals in your workforce. You must collect a signed acknowledgement from each covered individual.

https://www.mass.gov/guides/a-guide-to-paid-family-and-medical-leave-for-massachusetts-employers

Beginning October 1, 2019, start deducting family and medical leave payroll contributions for all your MA W-2 employees (and, if you are required, MA 1099-MISC contractors). 

See PDF 1 – Contribution Rates for Employers Charts

Employers with 25 or more covered individuals will be required to remit a contribution to the Department of Family and Medical Leave of 0.75% of eligible wages.  Up to 40% of the medical leave contribution should be withheld from a covered individual’s wages (0.248% of eligible wages).  Employers are responsible for contributing the remaining 60% (0.372%). 100% of the family leave contribution should be withheld from a covered individual’s wages (0.13% of eligible wages).   

See PDF 2 – Employers with 25 or More Covered Employees       

Employers with fewer than 25 covered individuals must remit an effective contribution rate of 0.378% of eligible wages.  This contribution rate is less because small employers are not required to pay the employer share of the medical leave contribution, reducing the total contribution amount.  100% of the medical leave contribution should be withheld from a covered individual’s wages (0.248% of eligible wages). 100% of the family leave contribution should be withheld from a covered individual’s wages (0.13% of eligible wages). 

See PDF 3 – Employers with Fewer than 25 Covered Employees

Employers offering approved private benefit plans may be exempt from making PFML contributions.  To be eligible for an exemption from making Paid Family and Medical Leave (PFML) contributions, you must offer an approved private plan with paid leave benefits that are equal to or more generous than   those   provided under the  PFML  program.  For more information on exemptions, please visit

https://www.mass.gov/info-details/private-plan-benefit-requirements-for-pfml-exemptions

Determine your 2018 Massachusetts workforce. Your MA workforce is the average number of the following types of workers you employed during the previous calendar year (Jan. 1, 2018 – Dec. 31, 2018):

Massachusetts W-2 employees (full-time, part-time, or seasonal). Generally, DFML follows the same eligibility criteria as the unemployment insurance program in Massachusetts. If you are required to report a W-2 employee’s wages to the Department of Unemployment Assistance (DUA), those employees should be counted. These employees don’t need to reside in Massachusetts to be covered.

Massachusetts 1099-MISC contractors.  Generally, a MA 1099-MISC contractor is an individual or sole proprietor who resides and performs services in Massachusetts for whom you are required to report payment for services on IRS Form 1099-MISC.  These individuals must be performing services in your trade or business or be regularly engaged to perform services for you.

Determining your 2018 Massachusetts workforce count will help you answer 2 important questions when it comes to your 2019 contribution responsibilities:  

  1. Whether or not your 1099-MISC contractors are considered covered individuals

  2. Whether or not you’re responsible for paying a share of the contribution


Counting your MA workforce (Calculating the number of full-time equivalents)

  1. 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.

  2. 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.

  3. If your 2018 MA 1099-MISC average is less than or equal to your 2018 MA W-2 average, only your MA W-2 employees are considered covered individuals.

  4. If your 2018 MA 1099-MISC average is greater than your 2018 MA W-2 average, your MA W-2 employees and MA 1099-MISC contractors are considered covered individuals.


Now that you know if your MA 1099-MISC contractors are considered covered individuals, you should have a final count of your 2018 covered individuals. 

See PDF 4 – Over 25 1099-MISC Contractors

If that number is less than 25, you won’t be responsible for the employer portion of the medical leave contributions.

See PDF 5 – Under 25 1099-MISC Contractors

PFML follows the same annual income limits as those set by the Social Security Administration. The 2019 income limit is set at $132,900.00.

By January 31, 2020, you must remit contributions through the Department of Revenue’s MassTaxConnect.

Implementation Steps

  1. Notify your payroll service of your Massachusetts workforce average number for 2018 (whether it is over or under 25). If the average number is close to 25, see instructions for counting your MA workforce.

  2. Determine if 1099-MISC contractors should be covered.

  3. Display poster in your workplace before September 30, 2019.

    See PDF 6 - PFML Poster

  4. Notify employees before September 30, 2019 and obtain signed acknowledgments.

 

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