As of the first payroll of 2023, Colorado's new FAMLI Paid Family Leave Program has taken effect, impacting businesses of all sizes.
Don't worry - DXA Group is here to help. Our team of experts can provide the guidance you need to comply with this new initiative and ensure that your business is set up for success.
The FAMLI program requires both employers and employees in Colorado to contribute through payroll deductions and employer contributions. This initiative aims to ease the financial burden for employers when their employees need extended time away from their jobs. While funding began in 2023, the benefits won't be available until the beginning of 2024 to allow time for the funding to meet the projected need.
The key points of the FAMLI program are:
- Eligibility: All employees who have earned wages in Colorado are eligible for paid leave benefits, regardless of the size of their employer. Self-employed individuals could opt into the program.
- Types of leave covered: The program provides up to 12 weeks of paid leave per year for a variety of reasons, including bonding with a new child, caring for a family member with a serious health condition, the employee's own serious health condition, or certain military-related events.
- Benefit amount: The program provides a percentage of the employee's average weekly wage, up to a maximum benefit amount, which is adjusted annually based on the state's average weekly wage.
- Funding: The program is funded through a payroll tax on both employers and employees, with the total contribution rate set by the Colorado Department of Labor and Employment. Employers are responsible for remitting the tax and maintaining records of their employees' contributions and benefits.
- Job protection: Employees who take leave under the FAMLI program are entitled to job protection and the continuation of health insurance benefits during their leave.
As employers, you’re required to register at FAMLI.colorado.gov before the first quarterly premium payment is due on April 30, 2023. You’re also required to notify employees of payroll deductions by posting the Required Program Notice by January 1st, 2023. If you haven’t done these things, work NOW with your DXA team members to move toward compliance.
Premiums for this insurance benefit are set at 0.9% of an employee’s wage, with 0.45% being paid by the employer and 0.45% being paid by the employee through a payroll deduction. Premiums may be adjusted in the future but are currently capped by law at 1.2%.
Small employers with 9 or fewer employees are not required to cover the employer share of premiums and are only responsible for deducting and remitting the 0.45% employee share to the FAMLI Division once per quarter.
In 2024 and beyond, eligible workers can receive up to 12 weeks of payments (or more in specific cases) on a sliding scale based on earnings, with lower wage earners receiving up to 90% of their wages. Workers can take FAMLI leave continuously, intermittently, or in the form of a reduced work schedule.
To view complete details, webinars, see FAQ’s, access a variety of tools, and find the Required Program Notice, check out FAMLI.coloraod.gov and please reach out to your DXA team for help navigating this and other employee and business related matters.