Washington Paid Family and Medical Leave Benefits Become Available for Employee Use

Seyfarth Synopsis: The Washington State Paid Family and Medical Leave (“WPFML”) law was enacted in 2017.  WPFML premium withholdings began January 1, 2019, and eligible employees can start receiving WPFML benefits as of January 1, 2020.  Over the past few weeks, the Washington Employment Security Department (“ESD”) has concluded the final phase of rulemaking and provided several updates regarding employer notice and posting requirements including publishing a model notice and poster.

When WPFML benefits become available to employees tomorrow, Washington will become the fifth state with an active paid family leave program — joining California, Rhode Island, New Jersey and New York. Later in 2020, Washington, DC paid family and medical leave benefits will become available to eligible employees, which will then be followed by Massachusetts in 2021, Connecticut in 2022, and Oregon in 2023.

WPFML is funded by a combination of employer and employee contributions.  Employers should have begun collecting employees’ premium contributions on January 1, 2019 (to the extent they have not opted to cover the employee portion of the premium), and the initial wage reporting and premium payment period was from July 1 - August 31, 2019.  Benefit payments to eligible employees are set to begin on January 1, 2020.[1]  For a list of covered absences, see below.

The ESD recently provided guidance regarding the mandatory notice to employees and the mandatory poster.  When an employee who may be eligible to receive WPFML benefits is absent from work due to family leave or medical leave for more than seven consecutive days, the employer must provide the employee a written notice of rights.  Generally, employers are required to display the poster in conspicuous places on the employers’ premises.  See below for further details regarding notice and posting requirements.

In addition, on December 20, 2019, the WPFML Phase Six (the final phase) of rulemaking went into effect.  Some topics impacted include the following:

• assessing and collecting premiums;
• voluntary plans;
• small business assistance;
• weekly benefits; and
• interplay with employer-provided paid leave.

A summary of select WPFML provisions follows.

Summary of WPFML Law’s Key Provisions

Covered Employers

“Employer” is defined broadly as any individual or type of organization having any person in employment.[2]  Therefore, virtually all private employers in Washington and some private employers who are not based in Washington but who have employees who perform some or all of their work in Washington will be affected by this law.

Covered Employees

To be considered a covered employee for WPFML purposes, an employee must have worked at least 820 hours during the qualifying period.  The “qualifying period” is the first four of the last five completed calendar quarters or, if eligibility is not established using the first four of the last five completed calendar quarters, then the determination may be made using the last four completed calendar quarters immediately preceding the application for leave.

Amount and Reasons for Leave

Under WPFML, eligible employees can take up to 12 weeks of “family leave” and/or up to 12 weeks of “medical leave” (as set forth below) per benefit year, up to a maximum annual aggregate of 16 weeks per benefit year.  The amount of available WPFML benefits for medical leave increases to 14 weeks per benefit year if the employee experiences a serious health condition with a pregnancy that results in incapacity, thus increasing the maximum aggregate 18 weeks per benefit year in that scenario.

Employees can receive WPFML benefits for the following reasons:

• Medical Leave for the employee’s own serious health condition;[3]
• Family Leave to care for a family member with a serious health condition;
• Family Leave to bond with the employee’s child during the first 12 months after birth or placement;
• Family Leave for any qualifying exigency as permitted under the federal FMLA, as they existed on October 19, 2017 for family members (as defined below).

Covered Family Members

For purposes of WPFML, “family member” includes an employee’s (1) child, (2) grandchild, (3) grandparent, (4) parent, including parent-in-law, (5) sibling, and (6) spouse, including a registered domestic partner.

Benefits

Beginning on January 1, 2020, covered employees may be entitled to WPFML benefits as follows:[4]

Employee’s Average Weekly Wage (“AWW”)[5]	WPFML Weekly Benefit[6]
50% or less of the state AWW	90% of employee’s AWW
greater than 50% of the state AWW	90% of 50% of the state AWW plus 50% of the difference between the employee’s AWW and 50% of the state AWW

 

Funding of WPFML

WPFML is funded by a combination of employer and employee premium contributions.  From January 1, 2019 through December 31, 2020, the WPFML premium is 0.4% of the gross wages paid each quarter.[7]  One-third of this amount is allocated to “family leave,” and two-thirds are allocated to “medical leave.”  The family leave premium is paid entirely by the employee.  The medical leave premium can be split between the employee and employer, with 45% paid by the employee and 55% paid by the employer. The employer can choose to pay all or part of the employee premium.  Employers with fewer than 50 employees employed in Washington are not required to pay the employer portion of premium.

Substitution of Employer-Provided Leave

An employer may, but is not required to, designate certain benefits, including but not limited to salary continuation, vacation leave, sick leave, or other paid time off as a “supplemental benefit.”  Employers may allow an employee who is receiving WPFML benefits to use such designated paid time as a “supplemental benefit payment.”  The choice to receive such a supplemental benefit payment lies with the employee.  An employer may not require an employee to take paid vacation leave, paid sick leave, or any other form of paid time off provided by the employer before, in place of, or concurrently with WPFML benefits.

Intermittent Leave

Although the WPFML law does not specifically address intermittent leave, the minimum claim duration payment is for eight consecutive hours of leave, and there is a waiting period of seven calendar days for most types of leave.[8]

Private Plan Exemption

Employers can comply with the WPFML law through a private “voluntary” plan approved by the Commissioner of the ESD. [9]  The Commissioner must approve any voluntary plan if he or she finds that there is at least one employee in employment and all of the following criteria are met:

• the benefits afforded to the employees are at least equivalent to the benefits under the state plan, including but not limited to the duration of leave;
• sick leave entitlement under Washington state law is in addition to any family and medical leave benefits;
• the plan is available to all eligible employees of the employer employed in Washington, including future employees;
• the employer has agreed to make the payroll deductions required, if any, and transmit the proceeds to the ESD for any portions not collected for the voluntary plan;
• the plan will be in effect for at least one year, and, thereafter, continuously unless the Commissioner finds that the employer has given notice of withdrawal from the plan in a manner specified by the Commissioner;
• the amount of payroll deductions will not exceed the maximum payroll deduction for the state plan;
• employees are eligible for benefits under the plan by meeting the state plan eligibility requirements and having worked at least 340 hours for the employer;
• employees are entitled to job protection if they (i) have worked for the employer for at least 9 months and 965 hours during the 12 months prior to the date leave will commence, and (ii) satisfy the applicability requirements for job protection under the state plan (see above); and
• the voluntary plan provides that the employer maintains the employee’s existing health benefits.

To seek approval for a voluntary plan, an employer must submit an application and pay a $250 nonrefundable application fee to the ESD.[10]

Mandatory Posting and Notice to Employees

Employers must display a poster setting forth certain details about the law, including information about filing a complaint, in conspicuous places on the premises of the employer where notices to employees and applicants for employment are customarily posted.  The model poster is available in English and Spanish here.

Further, when an employee who may be eligible to receive WPFML benefits is absent from work due to family leave or medical leave reasons for more than seven consecutive days, the employer must provide a written statement of the employee’s rights.  The written statement needs to be delivered by the later of (a) five business days after the employee’s seventh consecutive day of absence due to a WPFML qualifying event, or (b) within five business days after the employer has received notice that the employee’s absence is due to a WPFML qualifying event.

Job Protection

Employees who use WPFML have a right to reinstatement to either the same position or an equivalent position with equivalent employment benefits, pay, and other terms and conditions of employment if the employee: (1) works for an employer with 50 or more employees;[11] (2) has been employed by the current employer for at least 12 months; and (3) has worked at least 1,250 hours for the current employer during the 12 months immediately preceding the date on which leave will commence.[12]

Employers are prohibited from interfering with, restraining, or denying the exercise of, or the attempt to exercise, any valid right provided under the WPFML law, and from discharging or in any other manner discriminating against any employee for opposing any unlawful practice under the law.

Employer Takeaways

As benefits for covered employees begin on January 1, 2020, we expect additional guidance will be forthcoming.  Stay tuned for further updates.  In the meantime, please reach out to your Seyfarth contact for additional clarification and guidance on the WPFML law.

 

[1] Washington’s existing unpaid Family Leave Act sunsets on December 31, 2019.  See https://lni.wa.gov/workers-rights/leave/family-leave-act.

[2] “Employment” means personal service, of whatever nature, unlimited by the relationship of master and servant as known to the common law or any other legal relationship performed for wages or under any contract calling for the performance of personal services, written or oral, express or implied. The term "employment" includes an individual's entire service performed within or without or both within and without Washington, if: (i) The service is localized in Washington; or (ii) The service is not localized in any state, but some of the service is performed in Washington; and (A) The base of operations of the employee is in Washington, or if there is no base of operations, then the place from which such service is directed or controlled is in Washington; or (B) The base of operations or place from which such service is directed or controlled is not in any state in which some part of the service is performed, but the individual's residence is in Washington.

[3] A “serious health condition” is defined as an illness, injury, or physical or mental condition that involves: (i) inpatient care in a hospital, hospice, or residential medical care facility, including any period of incapacity; or (ii) continuing treatment by a health care provider under certain circumstances.

[4] An employee cannot receive WPFML benefits in any week in which the employee is eligible to receive federal or state unemployment, workers’ compensation or disability benefits.

[5] An employee’s “average weekly wage” is calculated by dividing the total reported wages in the employee’s two highest-paid quarters in the qualifying period by 26.

[6] As of January 1, 2020, the WPFML minimum weekly benefit is $100 and the WPFML maximum weekly benefit is $1,000.

[7] For calendar years 2021 and beyond, the premium rates will be based on the family and medical leave insurance account balance ratio as of September 30 of the previous year.

[8] No waiting period is required for leave for the birth or placement of a child.

[9] In addition to the plan requirements discussed here, the law also includes voluntary plan provisions on several additional topics, such as employee eligibility, posting of notice regarding the plan, employee costs, employee contributions, termination by the Commissioner, and employer penalties.

[10] For the first three years of a voluntary plan’s existence, re-approval is required every year. After three years, re-approval is required only if the employer makes changes to the plan.  Mandatory re-approval does not carry the $250 application fee.

[11] Determined as 50 or more employees for each working day during each of 20 or more calendar workweeks in the current or preceding calendar year.

[12] Employers may deny restoration to a salaried employee who is among the highest paid ten percent of the employees employed by the employer within 75 miles of the facility at which the employee is employed if certain conditions are met.