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Editor’s note: This article is part of an ongoing series intended to help employers prepare for the January 2024 start of employee benefits under Colorado’s FAMLI program. Look for additional articles in the coming weeks. 

Beginning on January 1, 2024, eligible Colorado employees will be able to receive benefits through the Family and Medical Leave Insurance Program (FAMLI). Although the program is administrated by the state, employers should consider other policies that may be impacted by the program. Below is a summary of common policies that may need to be adjusted in 2024 handbooks due to FAMLI. 

Handbook Options 

FAMLI regulations do not require a handbook policy as part of the employee notification requirements. However, covered employers may want to have a handbook policy to notify employees of potential benefits available through the program. Employers Council has developed sample policies that are suitable for employee handbooks intended for Colorado employers. The state also has a handbook insert that employers can use. 

Multi-State Employers 

Companies with employees in Colorado as well as other states (multi-state employers) will have additional considerations in deciding whether and how to address the program via a handbook policy. 

Many Colorado-based employers use an employee handbook reflective of Colorado state law, even for employees who are not based in Colorado. In most cases, employers can extend state-mandated benefits like paid jury duty and paid sick and safety leave to non-Colorado employees. In the case of FAMLI, however, only residents of Colorado are eligible to request benefits through the program. Multi-state employers using a FAMLI handbook policy should consider indicating this difference in eligibility, either in the policy title or body. Alternately, such employers may wish to omit a handbook policy entirely, instead communicating to Colorado employees directly through other channels. 

Multi-state employers using a national handbook and state supplements may choose to include the above policy in their Colorado supplement. Additionally, in the national handbook section on general leaves of absence, such employers may want to include language that if the law of the state where the employee is located is more generous than federal law, the state law will apply. 

FMLA – Substitution of Paid Leave for Unpaid Leave 

Under the federal Family and Medical Leave Act (FMLA), employees can be required to use accrued paid time off benefits (e.g., PTO, sick leave, vacation leave) while on leave. Under FAMLI, employees can be given the option to supplement FAMLI benefits with accrued paid time off benefits but cannot be required to do so. Employers with an FMLA handbook policy stating it as a requirement may need to adjust the language. This can be as simple as adding the phrase, “except as otherwise required by state law.” 

FAMLI regulations prohibit an employee from receiving more than 100% of their total wages combined from FAMLI benefits, employer paid leave, and employer-sponsored income replacement such as short-term disability coverage. Paid time off benefits used during FAMLI leave should be limited to “top-off” amounts. To address this regulation, employers may wish to indicate that paid time off benefits used during leave may be offset by the amount of FAMLI benefits. Employers Council provides a sample agreement on pages 7 and 8 of this whitepaper. 

This would be a particularly important caveat for employers that already offer income replacement benefits like short-term disability and paid parental leave. Keep watch for a future article on this subject. 

Paid Vacation, Sick, and Time-Off Policies 

If an employer permits employees to use their accrued leave to “top off” FAMLI benefits, existing paid leave policies may need to be adjusted. Other than qualified paid time off under the Colorado Healthy Families and Workplaces Act (HFWA), most employer-paid leave benefits are subject to employer-defined criteria, such as limiting eligible reasons to use the benefit. 

        Sick Leave