Update on Paid Family Medical Leave Proposed Rules on Supplemental Benefits: Employers Will Be Allowed to Top-Off State Benefits

UPDATE: The Washington State Employment Security Department (ESD) has been engaged in several phases of rulemaking to implement the Paid Family Medical Leave law (PFML). Five phases of rules have been adopted. ESD has now published its proposed Phase Six Rules, available here. The proposed Phase Six Rules address (1) an employee’s ability to top-off PFML benefits with supplemental benefits offered by employers (such as PTO, vacation, or sick time), (2) voluntary plan eligibility and notice issues, and (3) appeal issues.

The proposed Phase Six Rules clarify that employers and employees should not report supplemental benefits to the ESD¹ and that the ESD will provide employers with information about the PFML benefit determinations that employees will receive², which will assist employers in calculating the amount of supplemental benefits to offer to employees to top-off the partial wage replacement provided by PFML benefits.

As stated in our prior advisory, employers can offer supplemental benefits, but they cannot require that employees use supplemental benefits while on PFML leave. This is different from the FMLA, where employers can require that employees use available paid time off benefits while taking FMLA leave. Our prior advisory addresses other topics covered by the proposed Phase Six Rules, including voluntary plans.³

ESD is holding public hearings regarding the proposed Phase Six Rules on November 7, 2019, and November 12, 2019. Information about the hearings is available here. According to ESD’s timeline, the Phase Six Rules should be finalized November 18, 2019, with rules to take effect December 20, 2019. PFML benefits begin January 1, 2020.

Employer Considerations

• Review the draft rules and provide comments to ESD and engage in the upcoming public hearings with any feedback or concerns.
• Review existing PTO, vacation, sick time and other paid time off policies and consider whether or not to offer these paid time off benefits as supplemental benefits to employees who are on PFML leave.
• Consider whether any existing benefits, such as paid parental leave or PTO, should be modified to take PFML leave into account.
• Examine existing FMLA policies to consider implications PFML may have, including whether the use of existing paid time off benefits is required during leave.

DWT Webinar

Davis Wright Tremaine attorneys will continue to monitor the PFML rulemaking process. In addition, a complimentary webinar regarding updates to the PFML is scheduled for December 5, 2019. Register here.

FOOTNOTES

1 WAC 192-620-030
2 WAC 192-500-035
3 Please note, the proposed definition of Waiting Period has been removed from the proposed Phase Six Rules.