The Massachusetts Department of Family and Medical Leave has announced updated contribution rates and weekly benefit amounts under the state’s Paid Family and Medical Leave law.
The new rates go into effect on Jan. 1, 2022.
Under the changes, the maximum weekly benefit amount an eligible employee may receive during 2022 will be $1,084.31 per week. This is an increase over the maximum amount of $850 in 2021. The increase is based on the rise in the average weekly wage in the state from $1,487.78 to $1,694.24.
The contribution rate in 2022 (which is the percentage of an employee’s wages that will be withheld via payroll deduction) will be reduced from 0.75% to 0.68% of eligible wages. Eligible wages are defined as wages up to the Social Security contribution limit.
Employers with 25 or more covered individuals will be required to pay a contribution to the Department of Family and Medical Leave of 0.68% of eligible wages.
In 2022, employers will be able to withhold the following amounts for these contributions: up to 0.12% of eligible wages for an employee’s family leave contribution and up to 0.224% of eligible wages for an employee’s medical leave contribution. The employer share will be 0.336% of eligible wages for medical leave.
For smaller employers with fewer than 25 covered individuals, the contribution rate is about half the size as the rate for larger companies. Employers with fewer than 25 covered individuals must pay an amount equal to an effective contribution rate of 0.344% of eligible wages. These employers may withhold up to 0.12% of eligible wages for an employee’s family leave contribution and 0.224% of eligible wages for an employee’s medical leave contribution. Smaller employers are not required to pay a share of medical leave.
It is important that Massachusetts employers revise their policies and payroll systems to incorporate these changes.