New Hampshire has enacted legislation, which creates a voluntary Family and Medical Leave Insurance wage replacement program for employers. To participate in the Paid Family and Medical Leave (NH PFML) Insurance Plan, employers can contract with the state's selected provider (MetLife) or their own provider. Eligible employees may purchase NH PFML for themselves if their employers do not provide NH PFML insurance or an equivalent benefit.
The Details
Covered Employees and Enrollment
All employees working in New Hampshire for an employer with a physical presence in NH are eligible for NH PFML benefits.
If employers choose to fund the benefit on behalf of employees , open enrollment is not needed. All employees can be informed of the new benefit and how to file when needed. If employers are passing on some or all of the premium payments to the workforce, then open enrollment is required. Employees are not required to participate in NH PFML's program.
If an employee opts out of the employer plan, they cannot purchase insurance as an individual. New employees will have the ability to enroll within 30 days of their hire date and annual enrollment will allow employees the opportunity to join each year. Terminated employees will have the ability to purchase insurance as individuals if their new employer does not sponsor a NH PFML plan.
Eligible employees may purchase NH PFML for themselves if their employers do not provide NH PFML insurance or an equivalent benefit.
Enrollment Period
To participate in the NH PFML Insurance Plan, employers can contract with MetLife or their selected provider. The 60-day enrollment period for employers is scheduled to begin on December 1, 2022 and will begin for individuals on January 1, 2023.
Reasons for Leave
Leave can be taken for several reason including:
- The birth of the employee's child or a child's placement with the employee for adoption or fostering. Either must occur within the past 12 months;
- A qualifying exigency that arises from foreign deployment with the armed forces or to care for a service member with a serious injury or illness covered under the federal Family and Medical Leave Act (FMLA);
- A family member's serious health condition, including illnesses covered by the FMLA, such as the treatment for an addiction or a mental health condition; or
- The employee's serious health condition, unrelated to employment, when
their employer does not offer Short Term Disability insurance.
Benefit Amount and Taxes
The NH PFML Insurance Plan includes:
- Paid Family and Paid Medical Leave together in a single insurance policy
- 60% wage replacement benefits up to the Social Security wage cap for qualifying leave reasons
- Leave can be taken all at once (continuous) or in partial days (intermittent) with a minimum of 4-hour increments
- Employers have the choice of duration to offer under their NH PFML Insurance Plan:
For paid family leave, taxes are not automatically withheld from benefits but employees can request voluntary tax withholding. Employees need to submit a W-4S tax form to the Metlife claims team and taxes can be withheld. Paid medical leaves are treated like disability income and taxes are automatically withheld from benefits.
Costs and Tax Credits
Employers will have the ability to work directly with MetLife to customize a plan and premium to meet their business needs within regulatory parameters set by the state.
The NH PFML plan incentivizes employers to purchase six weeks of coverage by providing a Business Enterprise Tax (BET) Credit equal to 50% of the premium they pay. Employers will need to complete and submit the most recent Schedule of Business Profits Tax (BPT) Credit (form DP-160) to the NH Department of Revenue administration to claim the NH business tax credit.
An employer may fully fund the premium cost on their employees’ behalf, split the premium cost with employees or pass on the full cost to employees (in which case no BET credit would be available).
Employer Purchase Options
Employers are not required to purchase a plan through MetLife. New Hampshire Department of Insurance regulations allow other insurance companies to seek approval to provide paid family and medical leave benefit plans. However, employers who purchase other paid family and medical leave insurance plans or employer equivalent coverage will not qualify for the BET Tax Credit.
Employers can choose to provide:
- The plan issued by MetLife, the state’s insurance partner, and receive the 50% BET Credit;
- Other paid family and medical leave insurance plans approved by the New Hampshire Department of Insurance; or
- Self-insured employer equivalent benefit coverage. See the FAQs issued by the state for more information on what is considered an equivalent plan.
Employer Requirements
Employer requirements differ based on employer size.
All Employers
All employers are required to provide wage and leave information, work schedule and other benefit information to MetLife and are prohibited from discriminating or retaliating against employees for taking leave.
As a reminder, under current law employers are required to provide employees a statement of deductions each pay period.
Employers with 50 or more Employees
Employers with 50 or more employees must:
· Collect premium payments through payroll deduction. This requirement applies whether the employer opts into the NH PFML insurance plan or if employees purchase coverage under a NH PFML individual plan.
· Restore employees to the position they held prior to leave or to an equivalent position.
· Continue to provide health insurance during leave with employees paying any shared costs
Employers with Fewer Than 50 Employees:
- Smaller employers are not required to collect premium payments through payroll deductions but can choose to do so.
- Smaller employers can make premium payments through arrangements with MetLife.
Recommendations:
The information above is a summary of key provisions. Please visit the program website which includes more detailed information on employer responsibilities, the claims process and other helpful FAQs.