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Avoiding the Pitfalls

Tim Netkovick calls it the “kicker” in the law — and it’s a kick that could bruise an unsuspecting employer.

The law in question is the state’s new Paid Family and Medical Leave (PFML) law, portions of which went into effect on Jan. 1, with others to follow on July 1. The law essentially makes Massachusetts the most generous state in the country when it comes to allowing workers to take leave for medical and family-care reasons.

And employers need to be careful how they respond to claims, said Netkovick, an attorney with the Royal Law Firm in Springfield.

“If somebody has utilized PFML, there is what I call a kicker in that statute that says, if there’s any adverse action taken against the employee within a certain period of time, then it’s presumed to be in retaliation,” he told BusinessWest.

Indeed, if an employee challenges an employer’s actions following leave taken under the PFML law, the burden is on the company to prove there was some justifiable reason for taking the adverse action that had nothing to do with the leave request.

“The law does have a very strong anti-retaliation provision baked in. Often, these types of laws do have an anti-retaliation provision, but this one is a little unique,” said John Gannon, an attorney with Skoler, Abbott & Presser in Springfield.

“If an employer does take some kind of negative action against the employee — termination, suspension, demotion, even a negative performance review — within six months of the last day they took leave, there is a presumption that the employer retaliated,” he explained. “The employer can rebut that presumption, showing the motive for the decision is not linked in any way to paid family or medical leave use, but it does open the door to more potential litigation in this area.”

It’s a challenge to prove the action was justifiable, though not impossible, Netkovick said. Still, it’s not a headache employers really want to deal with.

“That’s a challenge we’ve seen come up a few times, where there were issues with the employment relationship before that, and then, all of a sudden, someone goes out on PFML leave,” he said. “There’s not really a lot of guidance on that yet. It might be assumed to be in retaliation, but if you can show something concrete that has happened, hopefully you can get someone to agree with you in the court system. You have to make sure you have your documents in order.”

The PFML law runs concurrently with other applicable state and federal leave laws, such as the federal Family and Medical Leave Act (FMLA) and the Massachusetts Parental Leave Act. Similar to the federal FMLA, a Massachusetts employee who returns to work after taking leave under PFML law must be returned to same or similar position as he or she had prior to their leave.

The new law requires employers to provide eligible employees up to 26 total weeks of leave in a benefit year. Currently, employees may be entitled to up to 20 weeks of paid leave to manage their own serious health condition, and may also receive up to 12 weeks of paid leave to bond with a child who is newly born, adopted, or placed in foster care, and up to 26 weeks to care for a family member in the Armed Forces.

On July 1, employees will also be able to receive up to 12 weeks to care for a family member — the employee’s spouse, domestic partner, child, parent, sibling, grandparent, parent of a spouse, or parent of a domestic partner — with a serious health condition.

“There’s a department called the Department of Family and Medical Leave that oversees this whole program, and approves and denies claims,” Gannon said. “They’ve done a pretty effective job of getting the word out there about this program, particularly back in 2020 and early 2021 when it was going live. I remember seeing radio ads, print advertising, a lot of online ads as well.”

As a result, employees tended to know about it, and many held off on, say, elective surgery or put off parental leave for a newborn until after Jan. 1, so they could access the full benefits of the new law, he noted. “We did see a spike [in taking leave] in January and February, and we anticipate we’ll see another spike in July or August of this year when the family-leave components go live, and employees can take leave to care for family members with serious health conditions.”

 

A Rising Need

Patrick Leary, vice president of Work Benefits Research at LIMRA in Windsor, Conn., noted that interest in PFML started to rise several years ago, but has accelerated in recent years, especialy last year.

“More people became caregivers for their parents or other family members affected by COVID,” Leary said. “On top of that, parents took leave to care for their children when remote learning kept them at home.”

Peter Miller, a partner with Millbrook Benefits and Insurance Services in Springfield, added that Massachusetts’ PFML law offers benefits similar to a short-term disability benefit, but won’t replace the need for employers to provide short-term disability insurance.

Leave under the PFML program applies to most W-2 employees in Massachusetts, regardless of whether they are full-time, part-time, or seasonal. Unlike the federal FMLA, the Massachusetts PFML law says an employee is not required to work for a minimum length of time in order to be eligible for leave. However, an employee must meet minimum-threshold earning requirements in order to be eligible for leave under the law.

Notice requirements for the new law work both ways; employers must provide written notice of the PFML program to all employees within 30 days of the employee’s start date, while employees must inform their employers of their need to take leave under the law at least 30 days before the start of the leave, and before filing an application for leave with the state. Where reasons beyond an employee’s control prevent them from giving such advance notice, they must inform their employer as soon as is practical.

Employers don’t have to offer their workers the state benefit; they can opt out of it and apply for an exemption from paying PFML contributions, but only if they purchase a private plan with benefits that are as generous as the state’s plan, and which provide the same job protections, including the anti-retaliation provisions.

“You have two options — you can deal with the state Department of Family Leave they set up, or you can have your own third-party administrator,” Netkovick said. “The private plan has to be set up to match the state plan. There’s no requirement it has to be better, but it has to at least match with the state plan.”

One reason a company might do so is because a third-policy benefits administrator offered that service, and the employer may prefer communicating with that entity over dealing with the state.

Gannon agreed. “One of the perceived advantages to going with private plans is that you do have a little more control over the administration of the plan,” he said, noting that it can be frustrating when the state gets it wrong — for instance, if an employee has been granted 22 weeks of leave rather than 20 because of an administrative error, to cite a hypothetical example.

“There’s nothing you can do to reverse that, which is frustrating for employers,” he told BusinessWest. “With private plans, at least in theory, you can reach out to the plan administrator and ask, ‘why did you approve this for 22 weeks as opposed to 20?’ With the state, it’s more challenging to do that.”

One thing is clear — in allowing employees to take amounts of leave not typical across the country, the state is layering on an additional staffing challenge at a time when companies in myriad industries are already challenged by worker shortages.

“If the state department or your third-party administrator makes the determination this person qualifies under PFML, then there’s really not much you can do,” Netkovick said. “I know that’s created staffing issues for a couple of our clients, but they’ve been able to work that out. If there’s some kind of mandated ratio, I could see that becoming an issue — you might have to hire people on a temporary basis.”

Gannon agreed it can be a hurdle, particularly since employees are eligible for leave starting from day one on the job.

“It has been a challenge from a staffing perspective, especially these days,” he said. “Staffing would be a challenge without all these job-protected forms of leave, and now we have PFML, too.”

 

Know the Facts

One key requirement of the PFML law is that employers need to put it in writing for their workforce.

“It doesn’t have to be in the handbook, but it has to be in writing, advising people of their rights under PFML and the qualifications,” Netkovick said, adding that some companies have made it a part of the handbook because they were revising that manual anyway. “But others have made it as a standalone policy that everyone has to sign off on.”

Gannon has also seen employers approach the communication question in different ways. “We’ve had clients doing a complete update of their handbook, not just to make sure they’re compliant with this law, but to determine whether other policies need to be changed,” he said, such as call-out procedures that give an employer enough time to manage absences from a staffing perspective.

Of course, those written policies need to make clear the anti-retaliation elements of the law, too. If an employee files a lawsuit against an employer for violation of the PFML law and the employer is found to be in violation, numerous remedies are available to the employee, including reinstatement to the same or similar position, three times the lost wages and benefits, and even the employee’s attorney’s fees.

That’s why training managers and supervisors on all aspects of the law is especially important, Gannon said. “They’re the ones who may not realize how strong the anti-retaliation provisions are. Depending on the size of the business, an employer may rely on managers and supervisors, and if they unknowingly retaliate against someone, it could be a problem for the entire organization. It’s important for those in supervisory or managerial roles to understand the law and how strong those anti-retaliation provisions are.”

Netkovick agreed, adding that yearly trainings on all aspects of workplace law, including Paid Family and Medical Leave, is a good idea.

“Companies need to be aware of that retaliation provision — I think that’s the key,” he said. “It’s worthwhile to keep that in mind at the beginning, so you know what the lay of the land is in case something comes up after the fact.”

 

Joseph Bednar can be reached at [email protected]

Law

Examining PFML

Paid family medical leave is now the law in Massachusetts. And while most all employers know that, they may not know all the provisions and eligibility rules for this important piece of legislation. They need to know, because failure to abide by all those provisions may be costly, in more ways than one.

By Katharine Shove, Esq.

 

Back in 2018, Gov. Charlie Baker signed the Massachusetts Paid Family and Medical Leave program (PFML) into law. That legislation has now taken effect, and many employers have questions about exactly how the law works and to whom it applies.

Beginning Jan. 1, 2021, most eligible employees who work in Massachusetts are entitled to paid, job-protected time off from work to manage a serious health condition of their own; to bond with a child following the child’s birth, adoption, or foster placement; or to care for a family member suffering from a serious health condition.

Katharine Shove, Esq

Katharine Shove, Esq

“The PFML law has strict notice requirements. Employers must provide written notice of the PFML program to all employees within 30 days of the employee’s start date.”

The PFML program is run by the state’s Department of Family and Medical Leave, providing income replacement benefits to eligible employees. PFML benefits are funded by a payroll contribution deducted from employees’ wages. Under the PFML law, employers were required to begin such contributions on Oct. 1, 2019.

 

 

Who Is Eligible?

Leave under the PFML program applies to most W-2 employees in Massachusetts, regardless of whether they are full-time, part-time, or seasonal. Unlike the federal Family and Medical Leave Act (FMLA), the Massachusetts PFML law says an employee is not required to work for a minimum length of time in order to be eligible for leave under the PFML law. However, an employee must meet the minimum-threshold earning requirements in order to be eligible for leave under the law.

 

How Many Weeks of Leave Are Available?

The PFML law requires employers to provide eligible employees up to 26 weeks of leave in a benefit year. Beginning Jan. 1, 2021, eligible employees may be entitled to up to 20 weeks of paid leave to manage their own serious health condition. Eligible employees may also receive up to 12 weeks of paid leave to bond with a child who is newly born, adopted, or placed in foster care, and up to 26 weeks to care for a family member in the Armed Forces.

On July 1, 2021, employees will be able to receive up to 12 weeks to care for a family member with a serious health condition. Under the Massachusetts PFML law, a family member could be an employee’s spouse, domestic partner, child, parent, sibling, grandparent, parent of a spouse, or parent of a domestic partner.

In the aggregate, eligible employees may not receive more than 26 weeks of paid leave in a benefit year, even if they have more than one family member who may need care.

 

Requirement of Written Notice to Employees

The PFML law has strict notice requirements. Employers must provide written notice of the PFML program to all employees within 30 days of the employee’s start date. Such notice must include information about the benefits under the PFML program, contribution rates, and job protections under the law. The notice to employees must also include an opportunity for an individual to either acknowledge or decline receipt. In addition to written notice, employers must display posters (issued or approved by the Massachusetts Department of Family and Medical Leave) that explain the benefits available to eligible employees under the PFML law.

 

Application Process

Employees must inform their employers of their need to take leave under the law at least 30 days before the start of the leave, and before filing an application for leave with the state. Where reasons beyond an employee’s control prevent them from giving such advance notice, they must inform their employer as soon as is practical. It is then the employee’s responsibility to apply for leave through the Department of Family and Medical Leave, and the department will make the decision as to whether the leave is approved or denied. Once the department receives the employee’s application, the department will request information from the employer relative to the employee’s job status.

 

Important Considerations for Employers

It is illegal for an employer to discriminate or retaliate against an employee for exercising any right to which he or she is entitled under the law, including the right to request PFML leave. To this end, the PFML law has a strict anti-retaliation provision. If an employer takes adverse action against an employee during the employee’s leave, or within six months after their return to work, there is a presumption that the employer retaliated against the employee for exercising his or her rights under the PFML law.

It is then the employer’s burden to prove there was some independent and justifiable reason for taking the adverse employment action. Adverse employment action can include termination of employment, disciplinary action, or reduction in status, pay, or benefits.

The PFML law runs concurrently with other applicable state and federal leave laws, such as the federal FMLA and the Massachusetts Parental Leave Act. Similar to the federal FMLA, a Massachusetts employee who returns to work after taking leave under PFML law must be returned to same or similar position as he or she had prior to their leave.

If an employee files a lawsuit against his or her employer for violation of the PFML law and the employer is found to be in violation of the PFML law, numerous remedies are available to the employee. These remedies include reinstatement of the employee to the same or similar position, three times the employee’s lost wages and benefits, and the employee’s attorney’s fees incurred in bringing the action.

 

Can Employers Opt Out of the Program?

Some Massachusetts employers can opt out of the PFML program and apply for an exemption from paying PFML contributions if they purchase a private plan with benefits that are as generous as the state’s plan, and which provide the same protections.

 

Get Assistance with Making Policy

The PFML rollout presents a great deal of new information to navigate both for employees and employers. A qualified attorney will be able to assist with interpretation of the PFML, amending current leave policies, and practical matters of doing business in this new benefit environment. For those with questions about the Massachusetts PFML program, the best protection is to seek guidance from an experienced employment-law attorney.

 

Attorney Katharine Shove is an associate with Bacon Wilson, P.C. and a member of the firm’s litigation team. She works on matters of employment law involving discrimination and retaliation, wage-and-hour laws, and workplace policies and compliance; (413) 781-0560; [email protected]

Law

Planning for PFML

By John Gannon, Esq. and Meaghan Murphy, Esq.

 

John S. Gannon

John S. Gannon

Meaghan Murphy

Meaghan Murphy

COVID-19 has created an extraordinary level of uncertainty and anxiety for businesses across the world. Since March, countless employers have been forced to dedicate just about all their energy and resources to sustaining a viable business in the face of mandatory closures, layoffs and furloughs, and ever-changing reopening regulations and guidelines.

In the midst of this chaos, it is easy to forget that the most generous paid-leave law in the country is coming to Massachusetts on Jan. 1, 2021. The Massachusetts Paid Family and Medical Leave (PFML) law provides all employees up to a total of 26 weeks of paid, job-protected family and/or medical leave to each year (up to 12 weeks of paid family leave and up to 20 weeks of paid medical leave). The PFML obligations extend to all employers in Massachusetts, regardless of size. As we approach the Jan. 1 PFML kickoff date, here are five things all businesses should be thinking about as they prepare to implement this complex new law.

 

Private-plan Exemption

The Massachusetts PFML program is a state-offered paid-leave benefit available to anyone who works in the Commonwealth. PFML is funded through a Massachusetts payroll tax paid by employees and employers with 25 or more employees. Interestingly, there is an avenue for employers to receive an exemption from collecting and paying PFML contributions. If a business offers company-provided paid-leave benefits that are greater than or equal to the benefits provided by the PFML law — typically through a private insurance carrier — it may be granted an exemption from the state PFML program.

Employers seeking an exemption need to submit an application with the state, which usually can be facilitated by the private carrier that is administrating the paid family and medical leave benefit.

Importantly, businesses that opt out of the state PFML program still need to abide by the job-protection and anti-retaliation provisions in the PFML law. Generally, employees who take family or medical leave under the law must be restored to their previous position or to an equivalent position when they return from leave, with the same status, pay, employment benefits, and seniority as of the date of leave. In addition, it is unlawful for any employer to discriminate or retaliate against an employee for exercising PFML rights (more on this below).

 

Employer-notice Obligations

Businesses are required to notify their workforce about the Massachusetts PFML program, including the new benefits and protections that apply to them. This notification includes displaying the PFML workplace poster in a highly visible location; providing written notice of contributions, benefits, and workforce protections to your eligible employees; and collecting acknowledgments of receipt of such written notice signed by all eligible employees.

Both the workplace poster and model employer-notice forms can be found on the state’s PFML website: www.mass.gov/info-details/informing-your-workforce-about-paid-family-and-medical-leave. Failure to provide the notice can lead to in a fine of $50 per employee for first violations, increasing to $300 per worker for subsequent violations.

Handbook Policies

In addition to meeting their PFML poster and written-notice requirements, employers should review and update other workplace policies that will be impacted by the new law. For example, other leave policies (e.g., sick, PTO) should be updated to note that PFML leave runs concurrently with those other leaves. Employers may also want to update attendance and related discipline policies, including procedures for requesting time off and/or call-out procedures.

It goes without saying — but we’ll say it anyway — that employers should establish and enforce their PFML policy and all other workplace policies consistently.

 

Performance Management

Employers should examine and recommit to their performance-management, discipline, and documentation policies and procedures. This is because employees who are let go or disciplined after taking PFML may have a lawsuit for retaliation if a business cannot prove the employment decision was related to poor performance or misbehavior. In fact, any adverse action taken against an employee during or within six months of PFML leave is presumed to be unlawful interference or retaliation.

As a result, employers’ expectations for performance and workplace conduct, and the consequences for failing to meet those expectations, should be clearly defined, and employers should document all such failures in a timely manner. This is critical to defending against a potential claim by an employee that his termination constitutes unlawful retaliation for his PFML leave use.

 

Training

Employers should make sure all managers receive training on performance-management and discipline policies and procedures, as well as how to properly document such issues. Managers should be disciplining employees consistently and holding them accountable for performance and discipline issues. If an employee who has used PFML leave is terminated for performance-related or disciplinary reasons, employers want to be in a position to support their lawful reasons for termination with proper documentation.

A manager turning a blind eye to performance or discipline issues, or failing to properly document them, can cost employers significantly down the road in the face of a lawsuit filed by a disgruntled employee. Well-trained managers are worth their weight in gold.

 

Bottom Line

Jan. 1 is fast approaching. Massachusetts employers need to be prepared to meet their PFML compliance obligations, which not only involves understanding how PFML benefits work, but also planning for increased frequency of employee time-off requests and longer leaves of absence. Employers with questions about how the new PFML law will impact their business should seek advice from legal counsel. u

 

John Gannon is a partner with Springfield-based Skoler, Abbott & Presser, specializing in employment law and regularly counseling employers on compliance with state and federal laws, including the Americans with Disabilities Act, the Fair Labor Standards Act, and the Occupational Health and Safety Act. Meaghan Murphy is an associate with the firm and specializes in labor and employment law; (413) 737-4753.

Employment

Understanding PFML

John Gannon says there are always hot topics within the broad realm of employment law. And sometimes — actually quite often these days — there are what he called “sizzling hot” topics.

The state’s Paid Family and Medical Leave (PFML) law certainly falls in that latter category. Provisions of the bill, specifically the contributions to be paid by employers, go into effect on July 1. The actual law itself doesn’t take effect until Jan. 1, 2021, but the time between now and then will go by quickly, said Gannon, an employment-law specialist with Springfield-based Skoler, Abbott & Presser, adding that employers should do whatever they can to be ready. And there are things they can do, which we’ll get to in a minute.

First, the law itself. Gannon used the single word ‘scary’ to describe it, and he was referring to the reaction of employers large and small who simply don’t know how this piece of legislation, which makes the acronym PFML a new and important part of the business lexicon, will affect their business but have a good right to be scared because of how generous it is.

“This is a payroll tax at its core. So I think employers are going to have questions about how and whether they’re going to be billed, what their tax contributions are going to be, and other concerns.”

Gannon is expecting the Paid Family and Medical Leave Law to be among the main focal points of conversation at the firm’s annual Labor and Employment Law Conference, set for May 21 at the Sheraton Springfield. The conference is staged each year to help local businesses stay abreast of laws and regulations relating to labor issues, said Gannon, and this year there will certainly be a number of issues to discuss. Indeed, breakout sessions are slated on a host of topics, including PFML; wage-and-hour mistakes; harassment, discrimination, and why employers get sued; a labor and employment-law update, how to handle requests for reasonable accommodations (there will be a panel discussion on that topic); and how to conduct an internal investigation.

But Gannon told BusinessWest that paid family and medical leave will likely be the focus of much of the discussion and many of the questions, primarily because the law represents a significant change in the landscape, and business owners and human resources personnel have questions about what’s coming at them.

The first of these questions concerns the contributions to start July 1.

“This is a payroll tax at its core,” he explained. “So I think employers are going to have questions about how and whether they’re going to be billed, what their tax contributions are going to be, and other concerns.”

A 30-page set of draft regulations was recently released by the Executive Office of Labor and Workforce Development’s Department of Family and Medical Leave, and that same office has issued a toolkit for employers with information on everything from remitting and paying contributions to notifying their workforce to applying for exemptions.

There’s quite a bit to keep track of, said Gannon, adding that, under the new law, Massachusetts employees will be eligible to take up to 12 weeks of paid family leave (up to 26 weeks in certain circumstances) and up to 20 weeks of paid medical leave. In most cases, leave may be taken intermittently or on a reduced-schedule basis.

Family leave can be taken to bond with a new child, for qualifying exigency related to a family member on (or called to) active duty or to care for a family member who is in the service, or to care for a family member with a “serious health condition.” Medical leave can be taken for the employee’s own “serious health condition.”

 

John S. Gannon

John S. Gannon

“Someone has a medical impairment, and they need a new chair, or someone needs to change their schedule — they can’t work mornings anymore — or whatever the change in job structure they’re requesting … these matters can get complicated. How do companies handle these requests? Do they have to grant them? How do they work with employees? These are all questions this panel will address.”

In most cases, the annual cap for family leave is 12 weeks, 20 weeks for medical leave, and 26 weeks total cap for both, if needed.

The employee must give at least 30 days notice of the need for leave or as much notice as practicable. The weekly benefit amount maximum is $850 to start; in future years, it will be capped at 64% of state average weekly wage. The weekly benefits will be funded by contributions from payroll deductions into a state trust fund. The initial rate will be 0.063% of the employee’s wages. Employers may require employees to contribute up to 40% toward medical leave and up to 100% for family leave. Employers with fewer than 25 employees are exempt from paying the employer share of the contributions.

Employers must continue employee health-insurance benefits and premium contributions during any period of family or medical leave, said Gannon, and they must restore employees who return from leave to their previous, or an equivalent, position, with the same status, pay, benefits, and seniority, barring intervening layoffs or changed operating conditions.

There are many other conditions and bits of fine print, he told BusinessWest, adding that, while Jan. 1, 2021 is a long seven business quarters away, business owners and managers can and should start to prepare themselves for that day.

They can start by asking questions and getting answers, he said, adding that small businesses with fewer than 50 employees have not had to deal with federal family medical leave regulations and thus are treading into uncharted waters.

“They’re going to have to start thinking about how they’re going to manage this from a staffing perspective,” he said, adding that he is expecting a number of queries along these lines at the May 21 conference and the months to follow.

“Employers have to start thinking about this and getting ready for this now because of how generous the leave portion of this is,” he explained. “This is going to be a real challenge for employers.”

But overall, it’s just one of many challenges facing employers in the wake of the #metoo movement and other forces within employment law, all of which can have a significant impact on a business and its relative health and well-being.

Handling requests for reasonable accommodations is another area of concern, he noted, and that’s why the conference will feature a panel of experts addressing what has become a somewhat tricky subject for many business owners and managers.

“Someone has a medical impairment, and they need a new chair, or someone needs to change their schedule — they can’t work mornings anymore — or whatever the change in job structure they’re requesting … these matters can get complicated,” he explained. “How do companies handle these requests? Do they have to grant them? How do they work with employees? These are all questions this panel will address.”

For more information on the conference, visit skoler-abbott.com/training-programs.

— George O’Brien

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