Massachusetts Finalizes Amendments To PFML Regulations

Seyfarth Shaw LLP

This past week, the Massachusetts Department of Family and Medical Leave (DFML) released an unofficial version of the final amendments to the Paid Family and Medical Leave (PFML) regulations following a public hearing and comment period. The final regulations, available here, include a number of notable changes regarding (1) coverage and eligibility requirements for private plan exemptions; (2) covered workers with multiple employers; (3) substance abuse disorders and policies; (4) the interaction between the use of leave provided by an employer and PFML benefits; and (5) an expanded and revised definitions section.

The final regulations have been submitted to the Secretary of State and are expected to be published on July 24, 2020.

Coverage, Eligibility Requirements And Other Changes For Private Plan Exemptions

The final regulations provide some clarity regarding the coverage and eligibility requirements for private plan exemptions. In particular, employers and covered business entities (CBE) with an approved private plan exemption must make coverage available by the covered worker’s date of hire. To determine whether a worker meets the financial eligibility requirements under the PFML Law, an employer or CBE may require a worker to provide verification of wages earned in Massachusetts. 

The final regulations also clarify that the weekly benefit amount and the leave allotment will be based on the covered worker’s average working week in addition to the wages or qualified earnings earned with the employer or CBE at the time of an application for benefits.

The final regulations further clarify that an employer or CBE with an approved private plan exemption is not permitted to seek reimbursement from the DFML.

The final regulations add language to avoid gaps in coverage when an employer or CBE is transitioning to a different private plan or between the State Trust Fund and a private plan. Employers and CBEs with new or different insurance carriers must ensure there are no gaps in coverage for covered workers. An employee will continue to be paid benefits by the DFML for the entire duration of leave, when such leave was filed with the DFML prior to the effective date of the employer transferring from the State Trust Fund to a private plan. Conversely, an employee will continue to be paid benefits under a private plan for the entire duration of leave, when such leave was filed under a private plan prior to the effective date of an employer transferring from a private plan to the State Trust Fund. Covered workers may file applications for benefits with the DFML on the first day of the first quarter after the termination of a private plan.

The final regulations also change the timeline for the DFML to notify an employer of a change in the term of an approved private plan exemption from 30 to 60 days.

Lastly, the final regulations provide that when a former employee, who has been separated from an employer or CBE for less than 26 weeks, applies for benefits, the entity with which the individual applies for benefits will depend on whether the individual is employed or unemployed at the time of filing. If the covered worker remains unemployed on the filing date, the covered worker should submit the application with the former employer or CBE. If the covered worker has become employed by a different employer or CBE at the time of filing, the covered worker should submit the application with the new employer or CBE. The new employer or CBE may require the covered worker to provide verification of wages in Massachusetts for the purposes of determining financial eligibility under the PFML Law.

Covered Workers With Multiple Employers

The final regulations also address issues related to employees with multiple employers. First, the calculation of the Weekly Benefit Amount is based on wages for a specific employer. Second, the final regulations delete references that allow the DFML to limit benefits based on benefits or wages from other employers. The final regulations also clarify that a covered worker with multiple employers is not required to take leave from each employer or CBE at the same time. This seems to indicate that, depending on the factual circumstances, the worker may need leave from one employer while not necessarily needing it from another employer. If all of the worker’s employers are on the State’s public plan, this should be a non-issue as the State will administer the worker’s PFML benefits accordingly. But, if one or more of the employers are on a private plan, this would seem to indicate that any PFML leave taken from one employer’s private plan will be separate and will not affect available PFML benefits from another employer’s private plan.

The final regulations also remove language allowing the DFML to reduce benefits where the covered worker has other benefits under another employer’s private plan or for wages earned from other employment. However, the DFML may consider wages from another employer or CBE or through self-employment if the aggregate amount a covered worker receives would exceed the covered worker’s Average Weekly Wage.

Substance Abuse Disorders and Policies

Substance abuse disorders may now qualify as a serious health condition, whereby family or medical leave may be taken for treatment by a qualifying treatment provider. However, absences because of an employee’s use of the substance do not qualify for leave. The final regulations also establish protections related to substance abuse treatment as well as guidance regarding when an employer may take action against an employee for substance use that violates an employer’s established policy.

Other Noteworthy Highlights From Final Regulations

  • The final regulations specify that when a covered worker uses accrued leave or leave through an Extended Illness Leave Bank program provided by an employer or CBE, the covered worker shall not receive any PFML benefits for the same period.
  • Each request for intermittent leave must be recertified consistent with the new definition of intermittent leave as described below.
  • Covered workers are required to notify the DFML within seven days of a change in circumstances affecting benefits.
  • The final regulations clarify that no PFML benefits are payable during the first seven calendar days after the date on which job protected leave begins.

Added Definitions and Clarifications

  • Accrued Paid Leave: Under the expanded definition, Accrued Paid Leave does not include paid leave under an employer or CBE’s (1) disability policy or program; or (2) paid family or medical leave policy.
  • Active Duty: The definition has been changed to require deployment to a foreign country to qualify as Active Duty. 
  • Average Weekly Wage: The definition has been clarified to address multiple employers.  If a covered worker has multiple employers, the Average Weekly Wage will be calculated for each employer or CBE separately.
  • Average Working Week: Under the new definition, the Average Working Week is the average number of hours worked from the two highest quarters of the 12 months preceding a worker’s application for benefits under the PFML Law.
  • Base Period: The definition clarifies that the Base Period is defined as the last four completed calendar quarters within the previous five calendar quarters.
  • Continuing Treatment by a Health Care Provider: The definition now includes an allowance for telehealth and removes reference to substance abuse disorders.
  • Extended Illness Leave Bank: Under the new definition, an Extended Illness Leave Bank is a voluntary program where covered workers may donate accrued leave time to fund a bank for the benefit of a co-worker experiencing a qualifying reason under the PFML Law.
  • Financial Eligibility Test: The expanded definition allows wages received from multiple employers or CBE within the Base Period to be aggregated to determine financial eligibility for leave.
  • Former Members of Armed Services: The definition deletes reference to the exclusion of workers for dishonorable discharge.
  • Intermittent Leave: The revised definition allows the usage of intermittent leave in 15 minute increments consistent with the employer’s policies provided, however, that payment by the DFML will not be made in requests of less than eight hours. 
  • Job Protected Leave: The definition clarifies that use of leave under an employer’s disability policy, paid leave policy, and Extended Illness Leave Bank program will begin job protected leave and such time will run concurrently with the PFML benefits.

You may access our previous updates on the proposed amendments to the PFML regulations here and here. We will keep you updated on any new developments as we approach the January 1, 2021 commencement of PFML benefits. 

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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