On April 4, 2016, New York Governor Andrew Cuomo signed legislation adopting a 12-week paid family leave policy for New York employees (the “Paid Leave Law”). (The text of the Paid Leave Law can be found in Part SS of recently passed New York State Budget at the following link: Budget). Once fully implemented, the Paid Leave Law will provide New York employees with up to 12 weeks of paid family leave for the purpose of (1) caring for a new child, (2) caring for a family member with a serious health condition, or (3) relieving family pressures when a family member, including a spouse, domestic partner, child or parent, is called to active military service.
Paid leave to care for a new child will be available to both men and women and will include leave to care for an adoptive or foster child. An employee may take paid leave to care for a new child any time within the first 12 months after the child’s birth or 12 months after the placement for adoption or foster care of a child with the employee. Paid leave to care for a family member with a serious health condition, includes leave to care for a child, parent, grandchild, grandparent, spouse or domestic partner. The legislation allows employers to establish rules limiting employees from receiving paid leave benefits for the care of the same family member at the same time as another employee.
Employers should note that the new paid family leave policy will be implemented gradually. Starting on January 1, 2018, employees will be eligible for eight weeks of paid leave, earning 50% of their weekly pay (capped at 50% of the statewide average weekly pay). The number of weeks of leave and amount of pay increases yearly until, by 2021, employees will be eligible for the full 12 weeks of paid leave, earning 67% of their weekly pay (capped at 67% of the statewide average weekly pay).
In order to be eligible to receive paid leave benefits, employees are required to have worked for their employer for at least six months. Paid leave benefits will be available on the first full day that leave is required for eligible employees (unlike New York State disability benefits where there is a waiting period before employees start receiving benefits).
Significantly, the paid family leave will be funded by a weekly payroll tax of about $1 per employee, deducted from employees’ paychecks. Based on this insurance model, employers will not have to face the direct financial burden of funding the paid leave benefits provided under the new law. Nonetheless, employers should begin to prepare for other administrative costs associated with the new law, including costs for implementing changes to internal policies and costs related to employee absences during their paid family leaves.
Since the Paid Leave Law was just signed into legislation and the first phase of implementation is not scheduled to begin until 2018, there has not yet been any significant guidance issued on the new law. We will continue to monitor for additional analysis or guidance issued by the State, if any, and will provide employers with updates on implementation as more information develops.