California extends paid family leave benefits

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Since 2004, the Paid Family Leave program has provided monetary benefits to employees who have to temporarily miss work to care for a sick family member or to bond with a new child. This program is funded through employee payroll deductions into the State Disability Insurance fund. Earlier this year, the Governor signed into law a bill that will take effect January of 2018 to increase these benefits. Under this law, the wage replacement benefits for qualified claimants will increase from 55% to 60% of the employee’s wages for higher income workers and to 70% for lower income workers, up to the maximum benefit amount. Also, the current one-week waiting period for benefits will end so that benefits will be payable immediately. Employers are not directly impacted financially from these changes because the benefits are funded through the SDI payroll contributions to the EDD. But an employer’s policy that pays wage replacement benefits in excess of Paid Family Leave benefits could affect how much the employer pays.

The Paid Family Leave program does not give qualifying employees the right to protected leave; it only pertains to paid benefits that an employee receives if he/she cannot work for qualifying reasons. It does not provide any entitlement for a certain amount of leave time or reinstatement rights like the Family Medical Leave Act or the California Family Rights Act. Employers are advised to check their policies to make sure that any reference to Paid Family Leave benefits is kept current and to consult with counsel as to medical leave situations.

In Coffee Break episode 16, Chris and Jennifer review the impact on employers of expanded paid family leave benefits, taking effect January of 2018.