Parental Leave Act Passed by Maryland General Assembly

The 2014 session of the Maryland General Assembly came to a close Monday night, ending a 90-day term in which state lawmakers passed numerous laws, including legislation raising the state’s minimum wage.  Maryland’s minimum wage will increase to $8/hour on January 1, 2015, and gradually rise to $10.10/hour in 2018.

Included among the State’s new laws is the Parental Leave Act, which requires certain employers to provide unpaid parental leave for the birth, adoption, or fostering of a child.

The Parental Leave Act requires companies with 15 to 49 employees to provide their employees with unpaid parental leave benefits and gives the Department of Labor, Licensing, and Regulation (“DLLR”) regulatory authority regarding the bill.

Under the law, an employer may not discharge or otherwise discriminate against an employee because the employee: (1) has requested or taken parental leave; (2) makes a complaint; (3) brings an action under the bill; or (4) has testified or will testify in an action or proceeding under the bill.

The Act allows eligible employees to take up to a maximum of six weeks of unpaid parental leave in a 12-month period for the birth, adoption, or foster placement of a child.

To be eligible for unpaid parental leave, an employee must have worked for the employer for at least one year and for 1,250 hours in the previous 12 months.  The law does not apply to:  (1) independent contractors; or (2) individuals employed at work sites where the employer employs fewer than 15 employees if the total number of employees employed by that employer within a 75-mile radius of the work site is also fewer than 15.

In order to invoke the law’s protections, an eligible employee must provide the employer with 30-days’ notice prior to taking the parental leave.  Prior notice, however, is not required if the employee takes leave because of a premature birth, unexpected adoption, or unexpected foster placement.

While an employee is on parental leave, an employer may fire the employee only for cause.  Supervisory employees may not be held personally liable for violations of the law.

Employers may deny unpaid parental leave to an eligible employee if the denial is necessary to prevent “substantial and grievous economic injury to the operations of the employer” and the employer notifies the employee of the denial before the employee’s leave period begins.

When an employee returns from parental leave, the employee must be restored to the same or an equivalent position.  As with denial of unpaid parental leave, an employer may deny restoration if the denial is necessary to prevent “substantial and grievous economic injury” to the operations of the employer, the employer notifies the employee of its intent to deny restoration, and in the case of parental leave that has already begun, the employee elects not to return to employment after the employer provides notice of its intention to deny restoration.

During the leave period, the employer is required to maintain existing coverage for a group health plan.  In certain situations, the employer may recover the premium if the employee does not return to work.

If an employer provides paid vacation leave to an eligible employee, the employer may require the eligible employee (or the eligible employee may elect) to substitute the paid vacation leave for any part of or all of the period of parental leave.  Commission-based employees on parental leave must be paid any commission that becomes due because of work the employee performed before taking parental leave.

If a court finds that an employer violated the bill’s provisions, it is required to award reasonable attorney’s fees and other costs of the action to the employee.

State and local government employers are exempt from the bill’s requirements.

Maryland’s Department of Legislative Services estimates that nearly 4,500 small businesses will be affected by the legislation.

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