Information contained in this publication is intended for informational purposes only and does not constitute legal advice or opinion, nor is it a substitute for the professional judgment of an attorney.
With less than eight months before benefits become available under the Massachusetts Paid Family and Medical Leave Law (PFML), the Massachusetts Department of Family and Medical Leave (Department) released proposed amendments to regulations previously finalized on July 1, 2019. Under the PFML, effective January 1, 2021, all private Massachusetts employers must provide covered individuals with paid family and medical leave, funded through a payroll tax. The proposed amendments to the PFML regulations are extensive and include several new definitions of key terms, additional guidance on the requirements for private plan exemptions, and information relating to the application for benefits. The most significant proposed amendments to the regulations are summarized below.
Properly Classified 1099-MISC Workers Are Not Covered Contract Workers
The proposed amendments codify previous Department guidance that employers need not count workers who are properly classified as independent contractors (1099-MISC workers) as part their workforce under applicable guidelines. Specifically, the proposed amendments modify the definition of “covered contract worker” to include only those self-employed individuals who (a) perform services as an individual entity in Massachusetts, (b) reside in Massachusetts, and (c) are not classified as an independent contractor pursuant to the unemployment statute (M.G.L. c. 151A, § 2).
Applications For Private Plan Exemptions
The Department has offered significant modifications to the regulations concerning exemptions through adoption of a private plan. While employers may continue to apply for an exemption from medical leave, family leave, or both, the proposed amendments prohibit the grant of an exemption for a private plan that covers only a portion of the workforce. All employees, covered workers and former employees under the PFML must be included within the private plan in order for the employer to be exempted. Once approved for a private plan, the employer will be exempted from both remitting contributions on behalf of covered workers and from quarterly filing requirements.
The proposed amendments now also include three additional requirements for employers to receive a private plan exemption:
- Internal Appeals Process: A private plan must provide covered individuals with an internal appeals process with the private plan administrator that must be used before the employee can exercise their rights to an appeal with the Department. The internal appeals process must give the individual at least 10 calendar days to submit an appeal, and must extend that period if the individual can establish that circumstances outside of their control prevented the filing of the appeal within the proscribed period.
- Provide Notice of Rights: The private plan must provide notice to covered individuals, as part of any determination, of their rights under both the private plan and the PFML.
- Calculating Benefits: For purposes of determining benefit amount, a private plan must determine the weekly benefit amount based on the wages earned with the employer at the time of an application for benefits.
Applications for Benefits
In an interesting twist, the proposed amendments add a new paragraph to the regulations, whereby employers may be allowed to submit an application for benefits on behalf of a covered individual, as long as the employer adheres to requirements and timelines under the PFML.
The proposed amendments also clarify the process for applying for benefits through the Department. The covered individual will be required first to give notice to their employer prior to applying for benefits. The Department will reject applications for benefits absent proof of such notice. Covered individuals must submit applications for benefits at least 30 days in advance of the anticipated start of leave, but no more than 60 days in advance. The proposed regulations, however, also provide that covered individuals may file applications as soon as practicable, if the covered individual was unable to meet the filing deadline for reasons beyond the covered individual’s “reasonable” control.
Reductions to Benefits
The proposed amendments add additional categories of wage or wage replacements that will reduce the PFML benefits. The weekly benefit amount is calculated on the individual’s average weekly wage at the time of the filing of a request for leave, which is determined by the individual’s earnings in the base period as reported to the Massachusetts Department of Revenue. In addition to unemployment benefits or any state or federal disability benefits, the proposed amendments provide that the weekly benefit amount will also be reduced by benefits received from an employer through an approved, exempted private plan or any wages received from “another employer or covered business entity or through self-employment.” The proposed amendments also provide that the weekly benefit amount may be reduced where a covered individual has an outstanding tax obligation or obligation for child support.
Also, under the proposed amendment, where the Department finds that a covered individual has failed to provide the Department with notice of a relevant change in circumstances which would have reduced the amount of PFML benefits paid, the covered individual will reimburse the Department the amount overpaid within 30 calendar days.
The proposed regulations clarify that there will be an initial seven-day waiting period for each application for benefits, with the exception of medical leave during pregnancy or recovery from childbirth if supported by a healthcare provider that this medical leave follows immediately after the family leave.
Presumption of Retaliation
Under the PFML, any negative change to the employee’s status or adverse employment action against an employee during a leave or within six months following the leave creates a presumption of retaliation, which the employer may rebut with clear and convincing evidence that the action was taken for a non-retaliatory reason. A proposed amendment clarifies that an employer’s notice to the Department that it has a bona fide belief that the covered individual committed fraud in connection with an application for benefits will not be considered a retaliatory act. In addition, a trivial or “subjectively perceived inconvenience that affects de minimis aspects of an employee’s work” will be insufficient to raise a presumption of retaliation.
The proposed amendments will be subject to public comment and hearing. The Department intends to hold video conference meetings if future social distancing guidance prohibits an in-person meeting. Those interested in submitting comments will also be able to do so through an upcoming web application that has yet to be released.