As Colorado employers are gearing up to comply with the new paid family and medical leave program, there are still many questions that have not been answered. There are several rulemaking sessions that are scheduled for this spring and into the fall. Here are some common questions that are being asked about the state’s Family and Medical Leave Insurance program (FAMLI).
Our organization has a short-term disability plan. Will that be enough to opt out of FAMLI?
A short-term disability plan will only cover an employee’s own serious health condition. That is just one of several reasons an employee can take FAMLI leave. To opt out of FAMLI, the member will need to draft a leave program that has the same coverage or better than what the state has drafted. Here are the reasons an employee can take FAMLI leave:
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For an employee's own serious health condition
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For the care of a newborn, adopted, or fostered child
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To care for a family member with a serious health condition
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For qualifying exigency leave
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To address safety needs or the impact of domestic violence and/or sexual assault
What does “self-funded” mean in the Employers Council whitepaper on FAMLI?
Self-funded means the employer chooses to pay for the leave benefits from their own resources rather than buying an insurance policy to pay them. In a self-funded arrangement, the employer sets up a plan, and claims are paid according to the plan’s provisions. Typically, self-funded employers pay short-term disability benefits using a third-party administrator who processes the claims. In this model, the employer is taking the financial risk. If the employer decides to self-fund their disability program, the state will require the employer to have a surety bond to show they can pay the claims for their employees.
Is there a third-party plan that we (the employer) can purchase that will meet all the requirements of the FAMLI program so we can opt out?
At this point, there are not those types of plans. Those types of plans are being created and will be submitted to the state insurance board for approval. They should be out in the market later this fall. The state has a proposed draft of guidance to insurance companies so they can create plans to meet the requirement of 8-13.3-501 C.R.S.
Is there a form that the employer can complete to submit their family leave plan to the State for approval to opt out of FAMLI?
The state has not released that form yet.
Can we (the employer) require the employee to use their PTO or vacation time before applying for leave from FAMLI?
Employees are not required to utilize their PTO or vacation time prior to taking leave under FAMLI. The employer can let the employee use this time to get 100% of pay, however. Employees should never receive more than 100% of wages.
Does FAMLI run separately from FMLA?
If an employee is also eligible for FMLA while they are on FAMLI leave, the two will run concurrently. Employees may not be eligible for FMLA while they are eligible for FAMLI as the eligibility for the two types of leave is different. Employees need to have earned $2,500 over four quarters in the state of Colorado to be eligible for FAMLI, and this does not have to be with one employer.
How will I know when an employee takes leave and when they are ready to return to work?
The state is still working through the build-out of the benefits section of this program. But there is a plan to provide the following:
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The state will notify the employer of the receipt of the claim with some questions about compensation that will need to be returned to the state.
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The state will also notify the employer when the employee is ready to return to work.
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The state will also provide tax reporting at the end of the year to the employee.
Do I need to hold the job open for an employee who will be out on an approved FAMLI leave, or can I fill the job?
If the employee has worked for 180 calendar days for the employer, their job will be protected by FAMLI leave.
What if we already have a parental leave policy where we are paying employees during that leave?
The employer can save some money and adopt the state-run program and discontinue their parental leave. Or the employer may keep their parental leave policy and allow employees to take that additional time after the employee has used all their FAMLI leave.
Will I need to update my handbook with language about FAMLI?
Employers will need to review their handbook and adjust their leave programs to explain how their private plan, insurance program, or FAMLI will operate. Employers will also need to look at how FMLA, parental leave, and personal leave programs will coordinate with paid family leave. Employers Council will be updating our handbook planning guide accordingly. We will let our Colorado members know when these sections are published.
How will employers submit the wages and FAMLI deductions to the state?
The state will have a portal where this information can be uploaded on a quarterly basis. It will be very similar to how employers are submitting workers’ compensation.
Please stay tuned for additional information from Employers Council as the state finalizes more procedures, updates information, or releases additional guidance. If you have questions, contact the Member Experience team by email or call 800-884-1328.