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By now, most Colorado employers have heard about the Family and Medical Leave Insurance (FAMLI) program. You have also probably heard that employers, by statute, may apply to substitute their own private family leave plan instead of participating in the state-run FAMLI program. What you may not have heard is that, per new guidance from the state’s FAMLI Division, even if you intend to use a private plan, you are required to register and contribute premiums to FAMLI starting on January 1, 2023.

Employees will begin receiving benefits under FAMLI on January 1, 2024. By statute, an employer may apply to the FAMLI Division for approval to meet their FAMLI obligations through a private plan. To be approved, a private plan must confer all the same rights, protections, and benefits provided to employees under the FAMLI program. It must, at a minimum, allow leave benefits to be taken for the same purposes, for the same amount of time, for any family member as defined by the statute, with as good or better benefits to the employee, for the same or less cost to the employee, and impose no additional conditions or restrictions on the leave benefits as what an employee would otherwise get under FAMLI.

Unfortunately, there is currently no method for an employer to apply to use its own plan because the rules to implement this part of the statute have not been published. In its recent guidance, the FAMLI Division stated that the “intensive due diligence work with our various stakeholders may mean that the market of equivalent private plan options will not be available to employers before 2023.” To address the issue, the Division has implemented “a temporary procedure whereby all Colorado employers will begin paying premiums in 2023, and those who secure an approved private plan effective on or before January 1, 2024, will be issued a refund of paid 2023 premiums, minus the private plan administration fee.”

The Division specified the following under this temporary procedure:

• All employers covered by the FAMLI Act must register with MyFAMLI+ Employer and will need to start collecting premiums in January 2023.

• Employers will begin remitting premiums and wage reports on a quarterly basis.

• Employers intending to meet their FAMLI obligations through a private plan must apply for and obtain a private plan exemption from the Division in accordance with forthcoming Private Plan Rules.

• Employers who apply for private plan exemption are subject to an administration fee in the amount specified by the forthcoming Private Plan Rules.

• If the employer has an approved private plan with an effective benefits date of no later than January 1, 2024, the employer will have its 2023 premiums reimbursed.

• Employers with approved private plans effective after January 1, 2024, will not be eligible for reimbursement of premiums.

• To ensure that the FAMLI Division can review and approve an employer’s request for a private plan exemption in time for a January 1, 2024, effective date, employers must apply to the FAMLI Division for a private plan exemption approval by October 31, 2023.

As Employers Council gets updates, we will inform members of changes and additional guidance supplied by the state. Until then, prepare your company to sign up for the MyFAMLI+ program, which is not yet available online, and to set up your payroll deductions and employer contributions according to the size of your business. To get a sneak peek at the draft rules concerning the substitution of private plans, click here.

If you need assistance navigating the rules surrounding FAMLI, please email the Member Experience team.