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New Jersey Expands Paid Family Leave

By Lori Welty, Esq., Absence Management Senior Compliance Attorney

New Jersey Governor Phil Murphy signed Assembly Bill A3975 into law, amending four key laws affecting leave of absence and disability:

  • the unpaid family and medical leave law, “New Jersey Family Leave Act” (NJ FLA);
  • the unpaid law protecting victims of domestic and sexual violence, New Jersey Security and Financial Empowerment Act (NJ SAFE Act);
  • the state’s Family Leave Insurance program providing for pay benefits during a period of family leave (NJ FLI); and
  • the state’s paid medical leave insurance program, the New Jersey Temporary Disability Insurance (TDI).

The changes to the NJ FLA and NJ SAFE are effective immediately (with one exception) while the amendments to NJ FLI and TDI vary in their effective dates, with most of the key changes going into effect July 1, 2020.

In 2008, New Jersey became the second state to adopt a state-mandated paid family leave program. Since then, four additional states have adopted statutory paid family leave, plus the District of Columbia, for a total of 7 programs, including California, Rhode Island, New York, Washington D.C. (benefits payable 7/1/2020), Washington State (benefits payable 1/1/20), and Massachusetts (benefits payable 1/1/21).

Key provisions of the legislation include:

Expanding the NJ Family Leave Act (effective immediately, unless otherwise specified)

  • Amends definition of child to delete the age/disability restrictions, and include foster children and children born by a gestational carrier (and amends the definition of parent accordingly);
  • Amends definition of employer to cover those with 30 or more employees (effective June 30, 2019);
  • Expands the leave reason for bonding to include foster placement and bonding with a child born via gestational carrier;
  • Expands definition of family member under the FLA to include parent-in-law, sibling, grandparent, grandchild, domestic partner, or any other individual related by blood to the employee, and any other individual that the employee shows to have a close association with the employee which is the equivalent of a family relationship;
  • Changes the total time limit for reduced schedule leave from a period of 24 weeks to 12 months;
  • Allows reduced schedule leave at employee’s option (without the requirement of employer’s consent); and
  • Allows intermittent leave for bonding.

Expands the NJ Security and Financial Empowerment Act (effective immediately)

  • Amends NJ SAFE act to include additional family members: parent-in-law, sibling, grandparent, grandchild, or any other individual related by blood to the employee, and any other individual whose that the employee shows to have a close association with the employee which is the equivalent of a family relationship;
  • Provides that an eligible employee can elect to use family temporary disability leave benefits for SAFE leave; and
  • Requires written notice as far in advance as reasonable and practicable under the circumstances unless emergency or unforeseen circumstances preclude prior notice.

Amends Temporary Disability Benefits & Family Leave Insurance Programs (effective dates vary as specified below)

Key changes include:

  • Expansion of Benefit Provisions
    • Doubling the number of weeks for FLI and TDI:Employees will be entitled to 12 weeks of TDI and FLI benefits during any 12-month period. Prior to the passage of this amendment, employees could take up to 6 weeks of FLI or TDI in a 12-month period (effective 7/1/2020);
    • Increasing benefits for intermittent leave from 42 days to 56 days: Employees will now be entitled to FLI benefits for 56 days of intermittent leave within a 12-month period (up from 42 days) (effective 7/1/2020);
    • Allows for benefits for intermittent leave for bonding with a child: Allows for FLI intermittent leave for bonding with a child, without an employer’s approval, and providing associated notice provisions (15 days’ notice for intermittent bonding and 30 days’ notice for bonding for continuous) (effective immediately);
    • Including domestic and sexual violence: The bill expands TDI and FLI benefits for reasons covered under the NJ SAFE law, for an employee who needs time for medical attention, counseling, or legal assistance or proceedings arising out of domestic violence or sexual violence for their own needs, or for a family member who was a victim. (effective immediately); and
    • Benefits for reduced schedule leave for TDI, with employer’s approval: New Jersey Senate Bill 844 has proposed adding TDI benefits for employees working on a reduced leave schedule (after an initial period of total disability). This law provides for the calculation of benefits for those periods of reduced schedule, if that bill is passed. The law provides that if an employer permits a reduced schedule, benefits for time taken on a reduced schedule must, when added to wages paid for the time works, equal at least the amount of total disability benefits that would have been paid had the employee been paid full TDI benefits. The maximum amount permitted for partial benefits is 8 weeks, unless an employer opts to approve up to 12 weeks. If an employer does not approve part-time disability, the employee is entitled to full TDI benefits (if NJ SB 844 passes, this provision is effective immediately);
    • Increasing the weekly benefit: Individuals can now receive 85% of their weekly wage, with the maximum benefit going up to 70% of the statewide average weekly wage.  Using recent data, the maximum benefit would increase from $650/ week to $860/week (effective 7/1/2020); and
    • Eliminates the Waiting Period for FLI benefits: The bill eliminates the one-week waiting period for FLI benefits (effective 7/1/2019).
  • Expanding Coverage
    • Expanding individuals eligible for FLI benefits: The legislation expands FLI benefits for an employee who needs to care for sibling, grandparent, grandchild, parent-in-law, or any other individual related by blood to the employee, and any other individual that the employee shows to have a close association with the employee which is the equivalent of a family relationship, and expands the definition of child to include a child through foster placement or gestational carrier agreement. (effective immediately).
  • Eliminates Ability to Require Use of Paid Time Off: The legislation eliminates an employer’s ability to require an employee to use and/or exhaust paid time off during any unpaid waiting period for benefits. Use of paid time off will only be at the employee’s option. (effective immediately)
  • Clarifies Source of Increased Benefits: Establishes a new contribution calculation and specifies that all increases in the cost of benefits will be funded by contributions made by employees and not employer contributions. (effective January 1, 2020)
  • New Notice Requirement: Mandates that employer must publish notice and provide by personal notice to each employee at the time of the establishment of the private plan, at time of hire, and within three business days of when the employer knows or should know that the employee may have a need for disability benefits or family temporary disability benefits. (effective immediately)

The changes to the NJ FLA, NJ SAFE, NJ FLI and NJ TDI programs provide employees with expanded leave and benefits to allow them to attend to their personal and family needs. FINEOS Absence can help with the administration of these plans and benefits. For example, FINEOS Absence provides seamless, straight through processing for pregnancy and child bonding claims, administering both paid benefits and concurrent unpaid leave entitlement all in the same claim.

For more information about FINEOS products, watch one of these on-demand webinars.