Maryland Paid Family Leave: What Employers Need to Know About

Thanks to the passage of its new Time to Care Act, Maryland is now the tenth state to mandate paid family and medical leave for employees. If you’re a Maryland employer, the Maryland paid family leave program applies to you.

You must make payroll changes and provide written notices to your employees. But we’ll get to all that (and more!) below. Read on for the scoop on the upcoming MD paid family leave law. 

But first, a recap: What is paid family leave?

Paid family and medical leave laws by state provide employees with paid time off for qualifying events (e.g., the birth of a child). There are over 10 states, plus D.C., with paid family and medical leave laws. 

There is no federal paid leave law. However, there is a federal unpaid leave law: The Family and Medical Leave Act (FMLA). 

Unlike paid family leave (PFL) or paid family and medical leave (PFML) laws by state, the FMLA requires covered employers (generally those with 50 or more employees) to provide unpaid, job-protected leave to employees for qualifying reasons.

Maryland paid family leave: The 6 biggest employer questions

The Time to Care Act of 2022 established Maryland’s Family and Medical Leave Insurance (FAMLI) Program. The program provides up to 12 weeks annually of paid benefits to employees who take qualifying family- or medical-related leave. 

Contributions were originally slated to begin in 2023. But in May 2023, the state passed Senate Bill 828, which pushed the contribution start dates back to 2024.

Here’s an overview of important dates to keep in mind:

  • July 1, 2023: Bill takes effect 
  • October 1, 2024: Contributions begin (previously scheduled for October 1, 2023)
  • January 1, 2026: Employees can start applying for leave benefits (previously scheduled for January 1, 2025)

Take a look at the following MD paid family leave FAQs and answers.

1. Does the law apply to all employers?

All employers with at least one employee must participate in the new PFL program (aka collect a contribution from employee wages). However, only employers with at least 15 employees must also contribute to the fund (50/50).

Take a look at the breakdown of employer responsibilities:

  • Employers with one or more employees must withhold a payroll tax from employee wages for the program
  • Employers with 15 or more employees must contribute toward the fund for each employee

Already offer paid family and medical leave to your team? If your current program satisfies the bill’s requirements, submit your private employer plan to the Maryland Department of Labor (MDL) for approval.

2. How much are contributions?

The Maryland paid family leave contribution rate is 0.9% of an employee’s covered wages and is split equally between employers with 15 or more employees and employees.

Employers with fewer than 14 employees do not have to contribute. However, you must withhold the employee portion of the tax from employee wages.

3. Which employees can receive PFL?

Maryland considers “covered employees” as those who work at least 680 hours over the 12 months immediately before their leave begins. 

So, what are the qualifying reasons for taking MD paid family leave? Maryland employees can use paid family leave to:

  1. Bond with a child (newborn, adoption, foster care, or kinship care)
  2. Care for a family member with a severe health condition 
  3. Recover from a serious personal health condition 
  4. Care for a next-of-kin service member
  5. Deal with a family member’s urgent need for deployment

4. How much do employees receive?

Again, employees cannot receive benefits until January 1, 2026.

Employees can receive a weekly wage of up to $1,000. The exact amount an employee receives depends on how their average weekly wage compares to the state average weekly wage. Maryland intends to increase the maximum amount annually. 

5. What do you need to do?

As a qualifying Maryland employer, you need to do two things to comply with the law:

  1. Provide written notices to employees
  2. Update your payroll

Written notices: Provide written statements to each employee at the time of hire and annually. This should go over employee rights and duties under the bill. The Maryland Department of Labor will create a standard notice for you to use.

Payroll updates: Update your payroll to withhold each employee’s contributions from their wages. And, contribute the employer portion, if applicable. 

6. Anything else I should know?

There are several types of leave laws Maryland employers need to know about—both paid and unpaid. 

The latest Time to Care Act is separate from the following existing laws:

  • Maryland Healthy Working Families Act: Paid sick leave accrual for employees at businesses with 15 or more employees
  • Maryland Flexible Leave Act: Paid leave (if offered by a business with 15 or more employees) used for bereavement or to care for family members with illness
  • FMLA: Unpaid, protected family and medical leave for employees employed at FMLA-covered businesses
  • Maryland Parental Leave Act: Unpaid parental leave to employees of businesses with 15 – 49 employees
  • Unemployment Insurance: Partial wage replacement benefits to individuals who become unemployed through no fault of their own

For more information on Maryland paid family leave program, check out the state’s program overview.

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MD paid family leave fast facts

Just interested in a quick overview? We get it—you have a lot on your plate. Take a look at the following fast facts about the upcoming MD paid family leave:

  • Payroll contributions begin October 1, 2024
  • All employees pay into the program via a payroll tax 
  • Employers with 15 or more employees must also pay into the program
  • Employees receive up to 12 weeks of paid and protected leave for qualifying reasons
  • Employees can use the time to care for a child, family member, or self
  • Employers must provide a written notice to new hires and employees annually

This article has been updated from its original publication date of May 2, 2022.

This is not intended as legal advice; for more information, please click here.

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