Insurance brokers and employers should begin preparing now for Maryland PFML.

Add Maryland to the growing list of states offering paid family and medical leave to many workers. As the federal government continues to discuss a U.S.-wide mandated paid family leave program, more state legislatures are introducing their own programs.

On April 9, 2022, the Maryland General Assembly voted to override Governor Larry Hogan’s veto of a broad-reaching PFML bill. The reasons an employee can take leave mirror New York’s legislation, which represented some of the broadest and best coverage in the country when it was introduced in 2017. Massachusetts and Connecticut then followed in New York’s footsteps.

The New York PFL plan was introduced in stages of increased benefits until 2021 saw the benefits fully phased in up to the maximum amount of $1068.36 per week for up to 12 weeks.

Maryland’s PFML benefits will become available January 1, 2025, but the state will begin collecting premiums on October 1, 2023. Benefits will begin at a $50 per week minimum, with a maximum of $1,000 weekly for up to 12 weeks in the first year. From there, maximum benefits will rise based on the state’s average weekly wage, with benefit caps announced for each year on September 1 of the prior year.

Who Qualifies for Benefits Under Maryland’s Paid Family and Medical Leave Act

Maryland patterned its eligibility requirements after states like New York, Connecticut, and Massachusetts. It is likely that a federal PFML program will also follow these requirements. Under the Maryland PFML law, employees can take leave to:

  • Bond within a year of the birth, adoption, foster care, or kinship care of a child
  • Care for a family member with a serious health condition
  • Recover or treat their own serious medical condition that prevents them from working in their current position
  • Care for a service member
  • Run a household when a service member in the family is deployed

Family members include children, parents, in-laws, spouses, siblings, grandchildren and grandparents. Maryland excludes domestic partners from coverage.

Every business, individual or government entity that employs at least one individual in Maryland must provide PFML benefits to all employees who have worked at least 680 hours in the 12-month period preceding their leave. That means part-time employees who clock at least 17 hours per week are eligible for leave.

Self-employed Maryland residents can elect to participate in PFML but must opt in for an initial minimum time of three years and can then choose to renew annually.

What Employers Need to Know About Maryland PFML

While all the details haven’t yet been outlined regarding employee and employer contributions, according to a report issued by insurance carrier SunLife, employers with more than 15 employees will be required to contribute to premiums.

Covered employees will be responsible for 75% of the premiums, although employers can elect to cover a portion of the employee’s premiums as an added benefit. In smaller organizations, employees will be responsible for 100% of the premium costs, as are self-employed program participants.

Employers will need to begin submitting premium payments, deducted from payroll, beginning in October 2023.

What Brokers Need to Know About Maryland PFML

Employers have the option of establishing a private plan, either through a qualified carrier or on a self-insured basis. Private plans must provide the same or better benefits, rights, and protections with comparable or lower premiums and must be filed with and approved by the Maryland Department of Labor.

As PFML programs expand across the country, insurance brokers have more opportunities than ever before to build relationships and increase revenue with this statutory benefit. While PFML programs have not been the most profitable by themselves, statutory benefits represent a foot in the door to share knowledge and build trust.

Insurance brokers licensed in Maryland can help guide business owners through the process of establishing a PFML plan. Then, they can save those clients money by bundling ancillary benefits written through top insurance carriers.

The DBL Center has 45+ years of experience in the statutory market and has been on the cutting edge of New York PFL and other PFML programs from coast-to-coast since their inception. As your back office team, we can guide you to the best benefits packages for your clients, while the Broker Dashboard: Net Revenue Tracker app helps you stay on top of renewals, cancellations and commissions with just a few clicks.

Are you ready for Maryland PFML? We can help.