Maryland has enacted legislation establishing a Family and Medical Leave Insurance Program to provide paid leave benefits to employees and a corresponding Family and Medical Leave Insurance Fund to collect contributions from employers and employees.
Beginning January 1, 2025, the Program will provide covered employees with up to 12 weeks (and up to 24 weeks in certain cases) of paid time off to tend to a new child, their own medical problem, or a family member's serious illness or urgent need resulting from a military deployment. Beginning October 1, 2023, employees and employers must begin making contributions to the Fund.
The Program covers all employers, defined as a person or governmental entity that employs at least one individual in Maryland (though only employers with 15 or more employees will be required to contribute to the Fund).
To be eligible, employees must have worked at least 680 hours over the 12-month period immediately preceding the date on which leave is to begin.
Amount of Leave
An eligible employee may take up to 12 weeks of leave per year. However, an employee may take up to 24 weeks of leave if the employee becomes eligible to take leave to tend to a new child and their own medical problem in the same year. For example, a parent could receive up to 24 weeks of leave if medical leave is needed during pregnancy followed by parental leave after childbirth.
Leave may be taken intermittently in increments of no less than four hours.
Additionally, leave will run concurrently with eligible leave taken under the federal Family and Medical Leave Act (FMLA), and an employee must exhaust all employer-provided leave (that is not required to be provided under law) before receiving benefits under the Program.
The Program provides partial wage replacement of up to 90 percent of an employee's average weekly wages, with a maximum weekly benefit amount of $1,000 for 2025. Beginning on January 1, 2026, the maximum weekly benefit will be adjusted annually to reflect the annual percentage growth of the area's consumer price index.
Specifically, if an employee's average weekly wage is 65 percent or less of the state average weekly wage, the weekly benefit amount payable to the employee will be 90 percent of the employee's average weekly wage.
If an employee's average weekly wage is greater than 65 percent of the state average weekly wage, the weekly benefit amount payable to the employee will be the sum of 90 percent of the employee's weekly wage up to 65 percent of the state average weekly wage, and 50 percent of the employee's weekly wage that is greater than 65 percent of the state average weekly wage.
For example, if the average weekly wage in the state of Maryland is $1,300 and the employee earns an average of $1,000 per week:
- 65 percent of the state average weekly wage would be $845.
- The difference between the employee's weekly wage and 65 percent of the state average weekly wage would be $155, 50 percent of which the employee would be entitled to ($77.50).
- The employee would be entitled to a total of $922.50 per week from the Fund.
Covered Reasons for Leave
An eligible employee taking leave from employment may submit a claim for benefits to:
- Care for a newborn child or a child newly placed for adoption, foster care, or kinship care with the employee during the first year after the birth, adoption, or placement;
- Care for a family member with a serious health condition;
- Attend to a serious health condition that results in the employee being unable to perform the functions of the employee's position;
- Care for a service member with a serious health condition resulting from military service who is the employee's next of kin; or
- Attend to a qualifying exigency arising out of the deployment of a service member who is the family member of the employee.
A "family member" is defined to include:
- A biological, adopted, foster, or stepchild, parent, grandparent, grandchild, or sibling of the employee;
- A child for whom the employee has legal or physical custody or guardianship;
- A child for whom the employee stands in loco parentis, regardless of the child's age;
- A biological, adoptive, foster, or stepparent of employee's spouse;
- The legal guardian of the employee or the ward of the employee or employee's spouse;
- An individual who acted as a parent or stood in loco parentis to the employee or the employee's spouse when the employee or employee's spouse was a minor; and
- The spouse of the employee.
By June 1, 2023, the Maryland Secretary of Labor will, based on a study, set the total rate of contribution and percentage of the total rate of contribution to be paid by employees and employers. Only employers with 15 or more employees are required to contribute to the Fund.
Employers cannot discharge, demote, or otherwise discriminate or take adverse action against an individual who has filed for, applied for, or received benefits under the Program; inquired about rights and responsibilities under the Program; communicated an intent to file a claim, complaint, or appeal related to the Program; or testified (or intends to testify) in a proceeding related to the Program.
The Program requires employers to restore an employee to an equivalent position of employment upon the expiration of leave. Additionally, employers may only terminate an employee on leave "for cause" and may only deny an employee's restoration rights if the denial is necessary to prevent "substantial and grievous" economic injury to the employer's operations and the employer provides the employee notice of the intent to deny restoration rights at the time the employer determines the economic injury would occur.
Procedural Requirements for Requesting Leave Benefits
An eligible employee must apply for benefits by filing a claim to the Maryland Department of Labor (MDDOL). MDDOL will notify the employer of an employee's claim for benefits within five business days after application.
The MDDOL will approve or deny the claim and notify the employee and the employer within 10 business days after the employee files a claim. If approved, the MDDOL will make the first payment of benefits to an employee within five business days after the claim is approved and make subsequent payments every two weeks until the benefit period ends.
If the need to use leave is foreseeable, an employer may require an employee taking leave under the Program to provide the employer with written notice of the employee's intention to take leave at least 30 days before commencing the leave. However, if the need to use leave is not foreseeable, the employee must provide notice to the employer as soon as practicable and, generally, comply with the employer's notice or procedural requirements for requesting or reporting other leave.
If leave is taken intermittently, the employee must make a reasonable effort to schedule the intermittent leave in a manner that does not unduly disrupt the operations of the employer, and provide the employer with reasonable and practicable prior notice of the reason for which the intermittent leave is necessary.
Employers must provide written notice to each employee at the time of hire and annually thereafter of:
- The right to receive benefits under the Program;
- The procedures for filing a claim for benefits;
- The employee's responsibilities with respect to providing notice prior to taking leave (and the penalties for failing to do so);
- The employee's right to file a complaint for alleged violations;
- The employee's right to job protection; and
- A description of prohibited acts, penalties, and complaint procedures.
The Maryland Department of Labor will develop standard notices for employers to use.
Employers must also provide notice of an employee's eligibility within five business days after an employee requests leave under the Program or the employer knows that an employee's leave may be for a covered reason. During any leave taken under the Program, employers must maintain the employee's health benefits in the same manner required under the FMLA.
The Program does not diminish an employer's obligation to comply with a collective bargaining agreement or an employer policy that allows an employee to take leave for a longer period of time than the employee would be able to under the Program.
An employer that provides eligible employees with a private employer plan and an employee that is covered by a private employer plan are exempt from making contributions to the Fund.
An employer may satisfy the requirement of the Program through a private employer plan consisting of employer-provided benefits, insurance, or a combination of both if the private employer plan is offered to all eligible employees and meets or exceeds the rights, protections, and benefits provided to eligible employees under the Program.
Employer must file their private employer plan with the MDDOL for approval.
While there are no immediate steps to take in response to the Program, employers should:
- Review current policies and consider whether they would like to make any changes to their policies to claim exemption from the Program (with enough time to submit their policies for approval).
- Follow developments related to contribution rates and the exact employer-employee split for contributions.
- Be prepared to provide the required notice to employees.