What are an employer’s responsibilities?
Employers are required to obtain this coverage for their covered CT employees. If choosing the state plan, employers are responsible for deducting, holding, and remitting employee contributions to the state. If choosing a private plan, employers will need to follow private plan exemption rules established by the state to obtain approval for their private plan.
As mentioned in “How much will CT PFML cost?”, the state plan is an all employee paid program. Contributions to be remitted are 0.5% of covered employees wages up to the annual Social Security cap ($142,800 in 2021).
In addition, at the time of hiring and annually, employers must provide notice to their employees containing:
- Entitlement to leave and general provisions
- The opportunity to file for benefits
- Retaliation prohibited
- Right to file a compliant with the Labor Commissioner
We expect additional information on record-keeping, collection, and remittance to be published by the state as they issue regulations in 2020 and 2021.
Can employers opt out of CT PFML and choose a private plan?
Employers can opt out of the state program and choose a private plan for their CT employees.
- The private plan must meet or exceed the state plan’s benefits
- Employees cannot be charged more than they would for the state program. The employer is responsible for funding the difference between the employee maximum contribution and the total cost of the private plan coverage if applicable.
- The private plan must be approved a majority vote of the employer’s employees.
- If an employer chooses a private plan, contributions do not have to be made to the FMLI Trust Fund.
Employer opt out options include:
- Self-insure and administer on their own
- Self-insure and use a third-party administrator (TPA)
- Purchase the insurance from a private carrier
How will CT PFML interact with my Unum short-term disability insurance?
Most benefits paid under Unum STD policies will be reduced (or offset) by the amount an employee receives or is entitled to receive under a state disability or paid medical leave program. For employees in states that mandate PFML coverage (like Connecticut), STD can provide important supplemental coverage above state-mandated benefits for employee medical leaves. For example:
- Many leaves last beyond the 12-week state-mandated benefit (which includes both family and medical leave). Short-term disability insurance can provide up to 26 weeks of coverage.
- In addition, the CT PFML program provides 12 weeks combined for medical and family events, so employees who have taken family leave will have less medical leave available to them. Private STD insurance can fill that gap.
- Medium to high income earners may receive low income replacement levels from state-mandated benefits alone. STD can supplement state benefits with higher benefit replacement levels.
We encourage employers to evaluate their STD plan in light of the new CT PFML law. In most instances, employers will want to maintain STD coverage as an important supplemental benefit above the state plan for medium and higher earners.
As an employer with CT employees, what are important deadlines for me to know about in 2021?
- 11/1/20: You can begin registering with the state at ctpaidleave.org. CT is asking that all employers register on the state’s website, ideally by the end of 2020.
- 01/01/21: Begin withholding employee contributions for the state program.
- 03/31/21: First payment is due to the state program. There is a 30-day grace period so the contribution can be submitted by 4/30/21. Quarterly payments due after the first payment.
If pursuing a private plan, employers must have their private plan exemption approved by 3/31/21 to avoid owing the 1Q contribution to the state program. There are several steps employers need to take prior to submitting an application for a private plan. For details, we recommend reviewing the ctpaidleave.org private plan guidelines, including the employer checklist.
What CT PFML plans will Unum provide for employers?
CT has not yet issued formal regulations. Unum is monitoring state rule making closely and evaluating our private plan offer. We are committed to keeping our clients and industry partners informed of our position as it is made. To ensure compliance with state requirements, we recommend covered employers enroll their CT eligible employees in the state plan by beginning employee deductions starting 1/1/21 and remitting contributions to the state plan in 2021. If you have questions on the state program or private plans, please contact a Unum representative.