BACKGROUND:
On May 10, 2022, Delaware enacted the Healthy Delaware Families Act, requiring paid, job-protected family and medical leave for Delaware employees. This program intends to help ensure that Delaware workers have financial support in the event they need to take a leave of absence from their job due to a serious health condition that impacts them or a family member, due to a family member’s overseas military deployment, or after welcoming a new child to their family. It allows an employee to take job-protected paid time off and their employer cannot retaliate against them for taking leave.
WHAT EMPLOYERS ARE EXEMPT:
- Less than ten employees (may elect to participate but not required)
- Federal government
- Seasonal business (defined as a business that is completely closed for at least 30 consecutive days per year)
HOW TO DETERMINE NUMBER OF EMPLOYEES:
All DE-based employees – Waivers + Reclassed Employees = Total Employees
- DE-based means the employee works 60% or more of their total hours worked within the state of DE
- Waivers are short-term (not expected to work for 12 months) and part-time (less than 25 hours per week) employees. A waiver form must be signed by employee and employer and submitted to DE LaborFirst to exempt the employee from contributions.
- Reclassed employees are employees who either telecommute from their homes outside of Delaware or are a Delaware employee temporarily on assignment out of state. Reclass is choosing to opt into the program for these employees and a reclassification form must be signed by both the employee and employer and submitted to DE LaborFirst.
*As employee thresholds change to 10 or 25, an employer has 30 days of reaching the new threshold to provide the required coverage. Once a new level is reached those employees retain the benefit for at least 12 months even if the employee count falls back below the threshold. A threshold number must fall and remain below the threshold for more than 12 months before an employer will be allowed to drop the previously required coverage*
TYPES OF PAID LEAVE:
- Parental Leave
- Care for new child (up to 12 weeks per year)
- Must be provided by all non-exempt employers with 10 or more employees
- Medical Leave
- Employee has serious health condition or injury (up to 6 weeks, every 24 months)
- Must be provided by all non-exempt employers with 25 0r more employees
- Family Caregiver Leave
- Care for family member with serious health condition (up to 6 weeks every 24 months)
- Must be provided by all non-exempt employers with 25 0r more employees
- Qualified Exigency Leave
- Assist while loved one is on overseas military deployment (up to 6 weeks, every 24 months)
- Must be provided by all non-exempt employers with 25 0r more employees
*Limit of 12 weeks combined leave total per year*
HOW THE PROGRAM IS PAID FOR:
- Employer is responsible for all contributions but employers can require employees to pay up to 50% of the cost via payroll deductions
- Contributions are calculated on the employee’s FICA wages at the following rates
- 0.32% for Parental Leave
- 0.40% for Medical Leave
- 0.08% for Family Caregiver/Qualified Exigency Leave (the 0.08% covers BOTH types of leave)
WHAT IS THE EMPLOYER RESPONSIBLE FOR:
- Determining employee eligibility
- Tracking employee in-state hours and wages
- Calculating contribution amounts
- Managing initial claims adjudication process to verify if application for leave is justified under the plan (similar to FMLA paperwork and administration)
PRIVATE PLANS:
- Private plans by an admitted carrier are allowed so long as they provide the same or better benefits than the state plan
- Contact your current insurance carrier to inquire if they offer a product that satisfies the requirements
- If a private plan is chosen they must submit to the Division for approval by December 1, 2024. This requires documents from the insurance carrier so the process should begin with the carrier ASAP
IMPORTANT DATES:
- December 1, 2024
- Deadline to apply for approval of private insurance plan
- Deadline for small employers (under ten employees) to voluntarily join
- January 1, 2025
- All employers with 10 or more employees must be registered with DE LaborFirst
- If using a third party payroll processor (ADP, Paychex, Gusto, etc.) please contact them prior to registering as they may provide special instructions to you
- Penalties can be assessed for any employers with 10 or more employees not registered or on an approved private plan
- If splitting cost with employees begin deducting employee contributions from paychecks
- All employers with 10 or more employees must be registered with DE LaborFirst
- April 30, 2025
- Employers first Hour and Wage Report is due to the Division
- Contribution payment for first quarter of 2025 is due to the Division
- January 1, 2026
- First date employees can submit a claim for paid leave
ADDITIONAL RESOURCES:
DE Paid Leave FAQs – https://laborfiles.delaware.gov/main/pfl/DDOL40327_Program_Overview_FAQs_v5.pdf
How to Register with DE LaborFirst – https://laborfiles.delaware.gov/main/pfl/How_to_Register_with_Delaware_LaborFirst.pdf
Employer Checklist for Registering with LaborFirst – https://laborfiles.delaware.gov/main/dlf/Delaware%20LaborFirst%20Employer%20Registration%20Checklist.pdf
DE Paid Leave Public Forums – https://labor.delaware.gov/delaware-paid-leave-is-coming/ To view scroll to the bottom to view the 10/17/2024 Video and Presentation Slides
Information on Private Plans – https://insurancechoices.com/risk-academy/delawares-paid-family-leave/
PKS & Company, P. A. is a full service accounting firm with offices in Salisbury, Ocean City and Lewes that provides traditional accounting services as well as specialized services in the areas of retirement plan audits and administration, medical practice consulting, estate and trust services, fraud and forensic services and payroll services and offers financial planning and investments through PKS Investment Advisors LLC.
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