On July 1, 2020, expanded Family Leave benefits went into effect for New Jersey employees. According to Governor Phil Murphy, who signed the changes into law February 2019, the expansion ensures that workers are no longer “forced to choose between caring for a family member and earning a paycheck.” The change accompanies New Jersey’s Earned Sick Leave Law and state minimum wage increases, which are “fundamental elements in building a stronger and fairer New Jersey for all working families.” The expansion is funded by a scheduled increase in taxable base wage, tax rate, and cap for TDI and FLI payroll deductions, described below.
The eligible weekly payment increased from 66.67% of an employee’s average weekly wages (capped at $667 per week) to 85% of an employee’s average weekly wages (capped at $881 per week). Additionally, the duration of Family Leave Insurance (FLI) increased from six weeks to 12 weeks of paid leave during a 12-month period. The duration of Intermittent FLI increased from 42 to 56 days.
Temporary Disability Insurance payments (TDI) also increased to 85% of an employee’s average weekly wages (capped at $881 per week).
These increases apply only to applications submitted July 1, 2020 or later. Applications made before July 1 follow the prior limits, even if the benefit period extends through July 1. For example, an employee who went on Family Leave starting June 20, 2020 would only be entitled to six weeks at 66.67% of their average weekly wages (capped at $667 per week), even though their leave extends past July 1, 2020.
The law also includes key revisions to FLI and TDI which have already taken effect:
- Family Leave eligibility expanded to include caring for siblings, in-laws, grandparents, grandchildren, other blood relatives, and any other individuals who can be shown to have the equivalent of a family relationship.
- Temporary Disability Leave eligibility expanded to include leave taken for medical attention, counseling, or legal assistance related to domestic or sexual violence, whether the victim is the employee or a family member.
- Employers with over 30 employees may not discriminate or retaliate against an employee who takes or seeks Family Leave.
- As of June 30, 2019, the Family Leave Act applies to employers with 30 or more employees, rather than employers with 50 or more employees.
- As of July 1, 2019, the seven-day waiting period or payment of FLI is eliminated.
What Should Employers Do?
- First, employers should ensure their Human Resources departments are aware of this update.
- Ensure all required signage is up to date and properly posted in a prominent location, such as a break room or kitchen. Updated posters may be ordered separately, or conveniently ordered all at once, by clicking here.
- Employers should then update their employee handbooks and leave policies to reflect the change.
- Now would be a good time for employers to conduct a mid-year payroll audit to verify that the new payroll deduction changes are being properly withheld:
- 2020 FLI and TDI taxable wage base increased from $34,400 to $134,900
- 2020 FLI tax rate increased from .08% to .16% up to a maximum of $215.84
- 2020 TDI tax rate increased from .17% to .26% up to a maximum of $350.74
- 2020 Social Security taxable wage base increased from $132,900 to $137,700
How Frier Levitt Can Help
Frier Levitt’s experienced employment attorneys are able to assist employers with any HR or employment law-related questions they may have. Call our office today to schedule a consultation. We also perform New Jersey Equal Pay Act audits to ensure employers are in compliance. Contact us today for more details.