As we previously reported, last spring Maryland passed the Time to Care Act (“TTCA”). Under the TTCA, Maryland joined a growing number of states that will offer a government administered paid family leave program to employees in the state. The new program’s benefits and requirements were detailed back in April 2022.
Originally the TTCA was set to go into effect beginning October 1, 2023, once the state issued regulations by June 1, 2023. During Maryland’s most recent legislative session, however, those deadlines have all been moved. Under Senate Bill 828, the TTCA’s deadlines are delayed for one year, and the following new deadlines have been established.
- October 1, 2023 – MD Department of Labor will set the total rate of contribution for the program;
- January 1, 2024 – MD Department of Labor regulations to be published;
- October 1, 2024 – Employer/Employee contributions begin;
- January 1, 2026 – Benefits begin (pushed back from January 1, 2025).
Other Changes:
While the major changes to the TTCA involved pushing back deadlines, the General Assembly did make some other significant changes. The major changes include:
- Setting the maximum employee contribution rate to no more than 1.2% of the employee’s wages;
- Raising the minimum contribution rate for employers of 15 or more employees to 50% of the total rate of contribution (up from 25%);
- Removing the requirement that employees must exhaust employer-provided leave (such as a Paid Time Off or Sick Leave plan) before receiving TTCA benefits;
- Capping the total benefits to 100% of the employee’s average weekly wage.
Benefits
As a recap, the TTCA will offer Maryland employees 12 weeks of partially paid family leave in each year for employees to care for themselves or a family member with a serious health condition. Serious health condition shares the same definition as found in the federal Family Medical Leave Act. If leave is taken for the birth or adoption of a child, employees can receive up to 24 weeks of paid leave each year if the employee needs additional time in the same year to tend to their own serious health condition.
Payments:
- 90% of salary, up to 65% of Maryland’s average weekly wage (“AWW”)
- 50% of salary over 65% of AWW;
- Minimum benefit: $50/week;
- Maximum benefit: $1,000/week.
- Total benefits combined with other aid leave benefits cannot exceed 100% of AWW;
Employer Requirements:
Although the timing is delayed, it is important to start preparing for the TTCA. All Maryland employers are required to either offer an equivalent self-administered or insurance administered plan that offers equivalent benefits or participate in the state administrated plan. The state plan is also the default option, if an employer chooses to offer its own benefits, it must notify the state in order to opt out of the TTCA program. If an employer fails to comply with the requirements, the employer faces substantial costs for non-compliance including penalties of up to $1,000 per employee as well as potential liability to employees who have an individual right to take civil action to recover lost wages.
If you have questions on how your business needs to prepare and comply with the TTCA, please contact one of the attorneys at Kollman & Saucier.