Understanding New York's New Paid Family Leave Law

New York Governor Andrew Cuomo executed sweeping legislation on April 4, 2016, that will gradually raise the minimum wage in New York to $15 an hour1 and provide a phased-in system of paid family leave benefits providing covered employees up to 12 weeks of paid family leave - currently the most comprehensive paid family leave program in the nation. This Insight discusses the leave provisions, benefits schedule, coverage and other essential details of the new paid family leave law,2 referred to as the New York Paid Family Leave Benefits Law ("PFLBL").

Essential Features of the Paid Family Leave Benefit Program

The PFLBL is a series of amendments to the New York State Workers' Compensation Law. When the amendments are fully phased in, covered employees will be eligible for up to 12 weeks of paid family leave annually to care for an infant or a family member with a serious health condition, or to assist with family obligations when a family member is called into active military service. Eligible employees will be paid by a state fund - not their employers - financed by deductions taken directly from employees' wages, not from tax contributions paid by employers. Notably, the paid family leave is not available for an employee's own serious health condition, although an employee may be eligible for income protection benefits under New York's existing short-term disability insurance program.3

Who Qualifies to Receive Paid Family Benefits and When Do They Qualify?

Paid family leave benefits will be available for employees in New York who work 26 or more consecutive weeks for an employer.4 Eligible employees meeting these criteria may receive paid family leave (1) to provide care for a family member because of the family member's serious health condition; (2) to bond with their child during the first 12 months after the child's birth, or during the first 12 months after placement of the child for adoption or foster care; or (3) to attend to obligations arising because the spouse, child, or parent of the employee is on active duty or has been notified of an impending call to active duty in the United States armed forces.5

Like workers' compensation benefits and state disability benefits, paid family leave benefits will be available to employees regardless of the number of employees a business employs.6 Any employer covered by the New York Workers' Compensation Law7 will have to permit eligible employees to take paid leave and will have to deduct contributions from their employees' pay to fund paid leave benefits.

Leave Entitlement

Unlike workers' compensation and state disability benefits entitlements, which provide only monetary disability or injury benefits and create no specific entitlement to an actual leave of absence, the PFLBL explicitly entitles employees who have worked for the employer for at least 26 weeks to a paid leave of absence pursuant to the phased-in schedule set forth below, and requires that employees be reinstated to their position or a comparable position upon return from the leave.8 The law thereby imposes new family leave obligations upon employers in New York not covered by the federal Family and Medical Leave Act ("FMLA") because they do not employ 50 or more employees within a 75-mile radius.9 Further, while the FMLA requires that employees be employed by the employer for 12 months and have worked for at least 1,250 hours within the previous 12-month period to be eligible for leave,10 an employee is eligible for PFLBL leave after only 26 weeks (6 months), and there is no minimum hours requirement.11

Schedule for Implementation of Paid Family Benefits

The requirement to provide paid leave, the amount of leave required, and the amount of pay that employees may receive will be phased in as follows:

(i) On or after January 1, 2018, employees may receive up to eight (8) weeks of paid benefits in any 52-week period at 50% of their average weekly wage, but in an amount not to exceed 50% of the New York State average weekly wage ("NYSAWW").12

(ii) On or after January 1, 2019, employees may receive up to 10 weeks of paid benefits in any 52-week period at 55% of the employee's...