By Stephanie Eddy
If you’re a business owner in Colorado and just learning about FAMLI, you’re bound to have questions. Or, you might have your head in the sand in hopes that ignoring this new paid leave program might make it go away. Well, we’re here to tell you that it’s time to prepare yourself because FAMLI is here to stay!
The good news is that through this program, employees have access to paid leave benefits through the state. However, as a business owner or HR business leader, there are things you should know and important decisions you’ll need to make.
We’ve laid out the key points employers need to know about FAMLI and information you can share with your employees.
What is Colorado’s Family and Medical Leave Insurance (FAMLI) program?
FAMLI is a program approved by voters in 2020 that ensures all Colorado workers have access to paid leave in order to take care of themselves or their families during life circumstances that pull them away from their jobs.
FAMLI provides employees with a portion of their wages during their leave, paid directly by the state. If you are an employer that is currently required to offer FMLA, this program covers the same conditions as leave under the FMLA and is designed to run concurrently with that unpaid FMLA leave.
FAMLI will likely help smaller businesses retain employees if they have not had something similar in place for their employees. Businesses that have a paid leave program in place may apply for an exemption that will have to be reviewed to determine whether it offers benefits that are equal to or greater than the FAMLI program.
How does FAMLI work?
Both employers and employees will contribute premiums to the program. These premium deductions will begin on January 1, 2023, and will be 0.9% of an employee’s gross wages.
Employees will pay no more than 0.45% of the premium cost, so employers will be responsible for the other 0.45%, unless they choose to cover more or up to the entire 0.9% premium themselves.
The percentage will be recalculated every year starting in 2025. Premiums will be paid online into the state’s system via the employer’s payroll system on a quarterly basis. If a business has 9 or fewer employees, then only the employee’s premium will be submitted.
Who is eligible?
Employees are eligible to request paid leave beginning January 1, 2024, after they have earned $2500 in wages from working the previous year in Colorado. This threshold can be met from work with a combination of employers.
How does leave work?
Starting January 1, 2024, employees will need to have the request for leave approved by the Colorado FAMLI division. Once approved, and depending on the need for the leave, the employee can take up to 12 weeks of paid leave (an additional 4 weeks is added for people experiencing pregnancy or childbirth complications).
During their leave, employees will receive between 37% and 90% of their wages from the state. Benefits are capped at $1,100 per week.
Leave can only be taken once a year across a rolling calendar year. For example, if 12 weeks of leave is approved to begin May 1, 2024, then the employee would not be able to utilize leave again until May of 2025.
How will an employer know about a leave request?
The state is currently working on a solution that would notify an employer when a claim or request is submitted, whether or not it was approved, and the length of time of the leave.
Can an employer replace an employee out on leave?
Employees on leave have the right to job protection. This means that once they return to work, they should be in the same position, with the same wage, and same seniority/status that they had before taking the leave.
Hiring temporary staff is allowed and encouraged. However, it is important that you be forthright that the position is anticipated just to be temporary.
Questions? We’re here to help
We’re here to help you successfully translate, navigate, and incorporate the FAMLI program into your business. And, we’re available to help educate your team on the benefits available to them.