Maryland is added to the growing list of states requiring paid family leave. The law will generally require 12 weeks (24 weeks in certain instances as described below) of leave in an application year for personal care, baby bonding and family care as described below. The program is funded by employees employed by employers of any size. Further, employers with 15 or more employees must contribute to the fund.
Employers subject to law
Employer means a person or governmental entity that employs at least one individual in the state. It does not include an individual who is the sole owner and only individual employed by a sole proprietorship, limited liability company, C corporation, or S corporation. A self-employed individual may opt into the program.
A covered employee means an employee who has worked at least 680 hours over the 12–month period immediately preceding the date on which leave is to begin.
Amount and reasons for leave
Beginning January 1, 2025, a covered employee is entitled to 12 weeks of leave in an application year for baby bonding; one’s own serious illness; to care for a family member with a serious illness; or a qualifying military exigency. Application year means the 12–month period beginning on the first day of the calendar week in which a covered employee files an application for benefits.
A covered employee may receive an additional 12 weeks of benefits if the covered employee qualifies for both parental leave (baby bonding) and a medical leave due to his/her own serious health condition in the same application year.
A family member includes a biological, adopted, foster or step child, parent, sibling, grandparent or grandchild or the covered employee’s spouse.
Leave benefits will be available on a continuous or intermittent basis.
Beginning January 1, 2025, a partial wage replacement benefit payable to a covered employee will be up to 90% of the employee’s average weekly wages, with a maximum weekly benefit amount of $1,000.
Starting January 1, 2026, the maximum weekly benefit will be adjusted annually to reflect the annual percentage growth of the area’s Consumer Price Index.
An employer must reinstate a covered employee to his/her former position upon return from leave. An employer must also maintain an employee’s health benefits during any leave in the same manner required under the FMLA.
An employer may only terminate an employee on such a leave for cause and deny the employee’s restoration rights if the denial is necessary to prevent substantial and grievous economic injury to the employer’s operations and the employer provides the employee notice of the intent to deny restoration rights at the time the employer determines the economic injury would occur.
Beginning October 1, 2023, employees employed by an employer of any size and employers employing 15 or more employees will begin making contributions to the Family and Medical Leave Insurance Fund.
The Secretary of Labor shall set the contribution rate by June 1, 2023.Funding contribution rates will be subject to change based on bi-annual studies done by the Secretary of Labor.
For leave that is foreseeable, an employer may require a covered employee to provide written notice of the covered employee’s intention to take leave at least 30 days before commencing the leave. If the need for leave is unforeseeable, the covered employee shall provide notice as soon as practicable and generally comply with the employer’s notice requirement for requesting leave.
For leave taken on an intermittent leave schedule, the covered employee shall make a reasonable effort to schedule the intermittent leave in a manner that does not unduly disrupt the operations of the employer and provide the employer with reasonable and practicable prior notice. A covered employee may not take intermittent leave in an increment of less than 4 hours.
An employer shall provide written notice to each employee of the rights and duties of an employee under this law at the time of hire and annually thereafter. The Maryland Department of Labor shall develop standard notices for an employer to use.
An employer may satisfy the requirements of this law through a private employer plan consisting of employer–provided benefits, insurance, or a combination of both if the private employer plan is offered to all of the employer’s eligible employees and meets or exceeds the rights, protections, and benefits provided to a covered employee under this law. A private employer plan shall be filed with the Maryland Department of Labor for approval.
An employer that provides covered employees with a private employer plan and an employee that is covered by a private employer plan are exempt from the contributions requirements.
Coordination with other leave laws
The Maryland Family and Medical Leave Insurance Program runs concurrently with FMLA, if applicable.
As with any new law, there remains many unanswered questions that need to be addressed by future guidance.
The information contained in this Benefit Beat is not intended to be legal, accounting, or other professional advice, nor are these comments directed to specific situations. This information is provided as general guidance and may be affected by changes in law or regulation. This information is not intended to replace or substitute for accounting or other professional advice. You must consult your own attorney or tax advisor for assistance in specific situations. This information is provided as-is, with no warranties of any kind. CBIZ shall not be liable for any damages whatsoever in connection with its use and assumes no obligation to inform the reader of any changes in laws or other factors that could affect the information contained herein.