Massachusetts employers who are enrolled in the state Paid Family Medical Leave (PFML) program are responsible for sending family and medical leave contributions to the Department of Family and Medical Leave (DFML) on behalf of their covered individuals.
To do this, employers must withhold PFML contributions from employees’ paychecks. Employers are only required to send an employer contribution if they have 25 or more covered individuals in their workforce. If the employer has fewer than 25 employees, they must remit the employee’s mandatory contribution.
By October 1st of every year, the DFML must announce the contribution rates for the coming year. Contribution rates are on a January 1-December 31 calendar year basis. The new contribution rates apply to wages earned on or after January 1 of each year. Individual contributions are capped by the Social Security taxable maximum.
What follows is recent guidance just announced by the DFML. These changes will go into effect as of January 1, 2024:
Employers with 25 or more covered individuals must send to DFML a contribution of 0.88% of eligible wages.
This contribution can be split between covered individuals’ payroll or wage withholdings and an employer contribution. The 0.88% is an increase over the 0.63% 2023 rate. The primary drivers behind the 2024 increase is in the medical contribution to 0.70% from 0.52% (2023) and an increase in the family contribution from 0.18% up from 0.11% (2023).
Action Item
In light of the increase discussed above, employers who currently participate in the state PFML program may want to consider whether the state program increase warrants consideration of leaving the state program to join a private fully insured or self-funded plan instead. Please note that doing so would require application to and approval by the DFMLA, but that those plans would not have to make PFML contributions.
2024 Rate for Employers With 25 Employees or More
Family leave
Up to 100% of the family leave contribution can be withheld from a covered individual's wages (0.18% of eligible wages).
Medical leave
Up to 40% of the medical leave contribution can be withheld from a covered individual's wages (0.28% of eligible wages). Employers are responsible for contributing the remaining 60% (0.42% of eligible wages).
Employers with fewer than 25 covered individuals must send an effective contribution rate of 0.46% of eligible wages. This is an increase over the 2023 employee contribution rate of 0.318% This contribution rate is less than the rate for employers with 25 or more employees because small employers are not required to pay the employer share of the medical leave contribution.
Family leave
Up to 100% of the family leave contribution can be withheld from a covered individual's wages (0.18% of eligible wages).
Medical leave
Up to 100% of the medical leave contribution can be withheld from a covered individual's wages (0.28% of eligible wages). There is no employer share for employers with fewer than 25 covered individuals.
The maximum weekly benefit amount that an employee can receive in PFML benefits in 2024 will be $1,144.90 per week which is an increase over 2023’s maximum weekly benefit of $1,129.82.
The Department of Paid Family and Medical Leave of Massachusetts has published its FY2023 Annual report which can be found here.
For additional information on how PFML weekly benefit amounts are calculated and/or changed please consult the guidance here.
As the workplace landscape continues to shift and transform, AssuredPartners continues to adjust its approach to engaging with employees about their benefits. Recent trends in remote or hybrid...
In today’s candidate-driven labor market, it is essential for employers to communicate the total value of the employee benefits program that their organization offers – not just the salary being...
Recent advancements in GLP-1 therapies are setting new benchmarks in the treatment of obesity and metabolic health. From groundbreaking gene therapies to substantial corporate investments, the...