mo·rassˊ

an area of muddy or boggy ground
a confused situation that has become so complicated it seems impossible to escape from or resolve

This is the first of a 3-part series on paid family and medical leave (PFML). In the next few days watch for these additional posts:

Details on the proposed federal paid family and medical leave act (the “FAMILY Act”)
“Can you help me design a single PFML plan that will satisfy all state requirements?”

I promise, fascinating reading for PFML geeks!

I’ve been practicing employment law longer than I care to admit, and have been in the absence and disability management industry for 11 years now. In my seasoned opinion, the paid family and medical leave trend is the biggest, most impactful development in the industry ever. Yes, the 1993 Family and Medical Leave Act was big. And yes, many states, both before and after enactment of the FMLA, have adopted their own similar (or dissimilar) job-protected leave laws. And yes, a few states have had paid disability and family leave benefits laws for a while now.

But now throw in a growing number of state laws that couple the pay component with job protection; laws that rarely match up with the FMLA; laws that are not the same state to state; and . . . well, you’re living through it as an employer, right? It seems impossible to manage sometimes, doesn’t it?

IF ONLY THE FEDS WOULD ACT!

A federal paid leave law would solve everything, right? Override all those complicated and conflicting state PFML laws with one simple federal program. Or is that just pie-in-the-sky?

Don’t kid yourself. Two bills proposing a federal paid family and medical leave act are currently pending in the U.S. Senate and House (SB 248 and HB 804). The proposed law is referred to as the Family and Medical Insurance Leave Act, or the FAMILY Act. I’ll summarize the details like leave reasons, durations, and funding in another blog post soon, but let’s not get bogged down in that stuff just yet.

I hate to burst your bubble but a federal law is likely to add complexity to the morass, not simplify it. Here’s why:

If passed, the FAMILY Act would not replace state PFML laws. The bills specifically state (§4(g)(1)):
This section does not preempt or supersede any provision of State or local law that authorizes a State or local municipality to provide paid family and medical leave benefits similar to the benefits provided under this section.

So the law would simply add YET ANOTHER layer of PFML benefits with which employers would have to comply.
We don’t know yet how the FAMILY Act would interact with existing state paid disability, family leave, or combined PFML laws. Turning again to the bills themselves (§4(b)(5)):
A benefit received under this section shall be coordinated, in a manner determined by regulations issued by the Commissioner, with the periodic benefits received from temporary disability insurance or family leave insurance programs under any law or plan of a State . . .

Talk about punting the hard stuff! Whether the federal benefits are primary and the state benefits secondary, or vice versa, or some other structure remains to be determined. Either way, employers are likely to have to comply with whichever law, state or federal, provides the more beneficial benefits provisions to employees. Coordination of employee and employer contributions to 2 programs, state and federal, with some overlapping (and some distinct) benefits coverage could be a nightmare.
It is unlikely the states with existing paid benefits laws will dismantle their programs. The disability programs of many states have been in place for decades; likewise, many of the paid family leave programs have also been paying benefits for years, such as California’s PFL program, operating since 2004. Significant state agencies have been created to manage these programs. They aren’t just going to go away! States are unlikely to end an existing program, put lots of state employees out of work, and cede the state’s chosen priorities on employee benefits to the feds.
While a federal PFML law may staunch the flow of new state laws somewhat, it is possible that many states will layer on additional paid leave provisions to fill the gaps left by the rather limited (by today’s’ PFML standards) provisions of the FAMILY Act. Most state laws now in effect or pending implementation provide broader leave reasons and cover significantly more family relationships like siblings, grandparents, grandchildren, and that trendy “like a family member” relationship.
The FAMILY Act doesn’t provide job protection and doesn’t jive with the FMLA completely, so employers will have to coordinate time off for job-protected leave under the FMLA; AND paid leave benefits under the FAMILY Act. I’ll talk more about that soon. Plus, there’s no provision for employers to have their own private or voluntary plans, so there’s no way to provide that smooth, improved employee/employer experience that comes with a managed private plan.

The lesson is an old, proven one: Be careful what you ask for! And join us for the next FAMILY Act installment, coming soon to your preferred screen.

MATRIX AND RELIANCE STANDARD CAN HELP!

You may have noticed, we are on top of all things PFML. Between Matrix and our sister company Reliance Standard Life Insurance, we offer PFML solutions in every state that allows private/voluntary plans. Whether you want to insure the plan or go self-funded, we can help. Example: For Connecticut’s upcoming paid family and medical leave program, we have an employer guide, materials to assist with the employee approval vote, and much more. For more information contact your Matrix or RSL account manager or practice leader, or reach us at ping@matrixcos.com.