Following a trend set by an increasing number of jurisdictions, the District of Columbia (the “District”) will generously expand an employee’s right to paid medical and family leave. (Our article on other recently enacted paid leave laws can be found here.) The Universal Paid-Leave Amendment Act of 2016 (the “Act”), which became effective April 7, 2017, will be financed by an employer-paid tax. In addition to the paid medical leave required by the Act, employers must provide paid family leave and paid parental leave to their employees.
Covered Employees and Employers
A covered employee is any employee who spends more than 50% of his or her work time working for a covered employer in the District of Columbia. A covered employer is any person or entity, other than the District or the federal government, which exercises control over the wages, hours or working conditions of an employee. Self-employed individuals may opt into the paid leave program.
The Act allows covered employees to take two weeks of paid medical leave for their own serious health condition, six weeks of paid family leave to care for or provide companionship to a family member with a serious health condition, and eight weeks of paid parental leave to care for children recently born to or adopted by a covered employee. Employees’ qualifying family members include children, parents, grandparents, siblings, and a spouse or domestic partner.
The benefit paid is a function of a covered employee’s average weekly wages. Lower wage earners (typically those who earn less than 150% of the District’s minimum wage) will receive 90% of their weekly wage while on paid leave, and higher wage earners have the ability to receive an additional sum, up to a maximum weekly benefit of $1,000. Beginning in 2021, the maximum weekly benefit will increase in accordance with the Consumer Price Index for All Urban Consumers in the Washington-Baltimore Metropolitan area.
Leave will be funded through employer contributions to a fund administered by the District. Covered employers must contribute an amount equal to 0.62% of the wages of each of its covered employees. In order to receive benefits, an employee will file a claim with the District. In addition, the Act does not provide job protection to employees who take leave while working for a covered employer that has fewer than 20 covered employees.
It is not yet clear how the government will collect the paid leave tax, how benefits will be administered, or what procedures employees will need to follow in order to file a claim for benefits. We expect Mayor Bowser to release guidelines on the collection of this tax and the administration of the paid leave in the coming months; she is obligated to begin collecting employer contributions to the fund no later than July 1, 2019. Employers will eventually be required to provide covered employees with paid leave notices upon hire and annually thereafter.
If you have any questions about the District of Columbia Universal Paid Leave Amendment Act of 2016, or if you would like specific information on how to comply with the law’s provisions, please contact a member of our Employee Benefits Practice Group.