In July, the Massachusetts Legislature passed an increase in the Minimum Wage, elimination of Premium Sunday and Holiday Pay and established Paid Medical and Family Leave.
So how does this affect you and your business?
Minimum Wage
The current minimum is $11 per hour. The Minimum Wage will eventually rise to $15 by 2023 and will be phased in our the next five years.
- 2019: $12.00 per hour
- 2020: $12.75 per hour
- 2021: $13.50 per hour
- 2022: $14.25 per hour
- 2023: $15.00 per hour
Premium Sunday/Holiday Pay
Current Premium Sunday/Holiday Pay is 1.5 times hourly wage. The Premium Sunday/Holiday Pay requirements for all employees will be phased out with full repeal in 2023.
- 1/1/2019: 1.4 times the hourly wage
- 1/1/2020: 1.3 times the hourly wage
- 1/1/2021: 1.2 times the hourly wage
- 1/1/2022: 1.1 times the hourly wage
- 1/1/2023: Full Repeal
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Paid Medical and Family Leave
Paid Medical and Family Leave will be administered through the MA
Department of Unemployment Assistance. Funding will be through employer and employee contributions made via payroll deductions.
Employers Subject to Leave Law
Fewer than 25 employees
- Employee job protected, paid
- Employees pay employee share of premium (40%) Medical Leave
- Employees pay 100% of premium (Medical & Family Leave)
- No employer contribution (Medical or Family Leave)
- Required to deduct the payroll tax from employees’ wages
25 or more employees
- Employee job protected, paid
- Premium split – 60% employer, 40% employee (Medical Leave)
- Employees pay 100% of premium (Family Leave)
- Required to deduct the payroll tax from employees’ wages
Duration
Up to 20 weeks of job-protected paid medical leave to care for a worker’s own serious health condition
Up to 12 weeks of job-protected paid family leave to care for a family member with a serious health condition, to bond with the employee’s child during the first 12 months after the child’s birth or the first 12 months after the placement of the child for adoption or foster care with the employee, or because of any qualifying exigency arising out of an employee’s family member being active duty or notification of an impending call or order to be in the Armed Forces
Up to 26 weeks of job-protected paid family leave to care for a covered service member.
Employee Eligibility
To be eligible for paid family and medical leave, an employee must meet the financial eligibility requirements for receiving unemployment compensation under Massachusetts law (which currently is to have earned 30 times the weekly unemployment benefit amount the employee would be eligible to receive and earned at least $4,700 during the last four calendar quarters).
Benefit Waiting Period
There will be a 7-day waiting period before leave can be used, except where an employee seeks to take medical leave during pregnancy or recovery from childbirth and the need for such leave is immediate and supported by documentation from a health care provider. During the 7-day waiting period, employees may use accrued sick leave or vacation pay or other paid leave.
Job Protection
After returning from leave, employees must be restored to the same or equivalent positions that they previously held.
Notification Requirements
Employers will be required to post a notice, and provide all new employees within 30 days of their hire with notice of benefits under the statute.
Benefit Amount
The maximum weekly benefit amount will be $850 per week, adjusted annually to remain at 64% of the state average weekly wage.
Filing Claims
Workers file a claim with their employer, 30 days in advance of the requested leave, if possible, including the date, reason, anticipated duration, and medical documentation. The first seven days are not covered but can be paid for by sick or vacation time.
Effective Date
The tax will kick in summer 2019, and paid leave benefits will become available in 2021.
