Sections 355.4 and 355.8 are amended to include standards for benefits at least as favorable in plans providing for paid family leave.

A new section 355.9 has been added to include paid family leave definitions.

A new subpart 380-1 clarifies applicability.

Subpart 380-2 has been added to describe eligibility for paid family leave and the types of qualifying events necessary to take paid family leave. Qualifying events for paid family leave include leave to care for a child after birth or placement for adoption or foster care within the first 12 months after the birth or placement; for a qualifying exigency arising from the service of a family member in the armed forces of the United States; or to care for a family member with a serious health condition as defined in section 355.9.

Section 380-2.5 provides that employees working 20 or more hours per week become eligible after 26 consecutive weeks of work, and employees who work less than 20 hours a week become eligible on the 175th day of work, and describes the rate of paid family leave for part-time workers, as well as establishing 26 weeks as the maximum amount of disability and paid family leave benefits that may be taken in a year.

Section 380-2.6 provides for an optional waiver for an employee whose regular work schedule never achieves the 26 weeks or 175 days in a 52 consecutive week period required to become eligible for paid family leave.

Subpart 380-3 has been added to explain the notice requirements for taking paid family leave. If the leave is foreseeable, the employee is required to give the employer at least 30 days advance notice – if they fail to do so, the self-insured employer or carrier may file a partial denial of the family leave claim for up to 30 days. If notice is not practicable, the employee must notify the employer as soon as it is practicable.

A new subpart 380-4 describes the notice of claim and certification requirements for a paid family leave claim, including medical certification and HIPAA authorization. For leave taken to care for a family member with a serious health condition, the employee must obtain medical certification from the health provider with information about the patient’s health condition, and the estimation of frequency and duration of leave necessary, among other information. For a qualifying exigency, the employee must provide a copy of the military member’s active duty orders and/or other documentation supporting the leave.

For leave to bond with a child, the birth mother must provide a birth certificate or documentation of pregnancy or birth from a health care provider including the mother’s name and birth or due date. A second parent must provide a birth certificate, documentation from a health care provider, voluntary acknowledgment of paternity or court order of filiation. An adoptive parent must submit documentation showing an adoption is in process, or documentation illustrating the leave is to further the adoption. A foster parent must submit a letter from the county or city department of social services or local volunteer agency.

A new subpart 380-5 provides information about filing a claim, as well as the payment and denial process of a paid family leave claim, including uninsured employers. The employee must complete the Request for Paid Family Leave on the form designated by the carrier, and, if the carrier allows it, may file the claim in advance if the leave is foreseeable. The carrier will provide the employee with contact information and any missing information, and within 18 days will pay or deny a completed claim. Section 380-5.5 also provides that when the employer is uninsured, such claims will be paid from the Special Fund for Disability Benefits. Part 380-5.6 provides a framework for method of payment of claims.

Subpart 380-6 has been added to explain the benefit rate and use of accruals by an employee in conjunction with paid family leave.

Subpart 380-7 has been added to detail employer obligations under paid family leave, including collecting contributions, continuing health insurance (as long as the employee continues contributing to the cost as before paid family leave), and maintaining paid family leave insurance coverage as an individual business owner. Employers may deduct contributions before paid family leave becomes effective, and must post a notice concerning paid family leave. Subpart 380-7 also provides information about continuing deductions while an employee is out on leave.

A new subpart 380-8 provides for reinstatement of the employee to the same or a comparable job upon returning from paid family leave, as well as a process for discrimination or retaliation claims if reinstatement is denied after being formally requested by the employee. The Board will schedule hearings to determine a discrimination case.

Subpart 380-9 has been added to provide a process for disputes related to paid family leave. Any claim-related dispute arising under the paid family leave statute will be eligible for, and subject to, arbitration. This Subpart outlines the arbitration process and fee structure, including requiring a $25 filing fee by the initiating party which is refundable by the carrier should the employee prevail. It also provides that all disputes shall be resolved by desk arbitration unless the arbitrator finds further development of the record necessary.

Subpart 380-10 has been added to provide for public employers that opt-in for voluntary coverage for paid family leave. A public employer may opt-in for paid family leave only. It outlines a process for providing coverage for public employees who are or are not represented by an employee organization as described in section 212-b. Subpart 380-10 also provides that if the public employer already offers disability leave benefits and wishes to provide paid family leave benefits, both must be offered under a single insurance policy.

Subpart 361 is amended to provide that Article 9 benefits (both disability and paid family leave) to employees will meet the requirements of the Superintendent of Financial Services.

Part 361.1 has been amended to provide for including paid family leave in the self-insurance regulations, including the option for self-insurers under section 204 to also self-insure for paid family leave or purchase a paid family leave policy from an insurance carrier.

Part 361.2 has been amended to make clear that self-insurers are responsible for covering the cost of paid family leave if it exceeds the statutory maximum contribution which may be collected from employees.

Part 361.3 has been amended to indicate that the security deposit for a self-insurer for both paid family leave and disability benefits will be combined, and outlines the process for the surety bond.

Part 361.4 has been amended to include clarifying information about self-insurer reports to be submitted to the Department of Financial Services, and outlines what information will be required in those reports.

Part 361.5 has been amended to restrict the use of third-party administrators to those licensed by the Workers’ Compensation Board.

Parts 361.6 and 361.7 have been amended to fix capitalization and numeration.

Part 376 has been amended to change chairman to Chair, and to reflect the minimum amount of deposit for disability benefits only.

A revised Regulatory Impact Statement is not required because the changes made to the last published rule do not necessitate revision to the previously published document. The changes to the text still seek to implement the paid family leave program in a way that accomplishes the goals highlighted in the Regulatory Impact Statement. These changes, while some of them are substantial, do not affect the meaning of any statements in the document.

A revised Regulatory Flexibility Analysis is not required because the changes made to the last published rule do not necessitate revision to the previously published document. The changes to the text still seek to implement the paid family leave program in a way that accomplishes the goals highlighted in the Regulatory Impact Statement. These changes, while some of them are substantial, do not affect the meaning of any statements in the document.

1. Types and estimated numbers of rural areas

The proposed regulations apply to all covered employers, including those in rural areas. Regardless of geographical area of New York State, if the employer has one or more employees on each of at least 30 days plus four weeks in any calendar year, the paid family leave statute requires that they must offer paid family leave coverage.

2. Reporting, recordkeeping and other compliance requirements; and professional services

The same compliance requirements apply to rural employers, employees and carriers as in metropolitan areas. Covered employers must provide paid family leave coverage to their employees. This is done through the New York State Insurance Fund, a licensed New York State insurance carrier, or through self-insurance if certain requirements are met and the Board approves. Other than purchasing a paid family leave insurance policy from a licensed New York State insurance carrier, no special professional services should be required by rural or any other areas. The covered employers must also provide either an update to employee handbooks or provide written guidance regarding paid family leave benefits to their employees. Paid family leave is funded by employees through a modest deduction from each employee’s paycheck. Employees who take paid family leave are also entitled to reinstatement to their same or comparable job upon returning to work under the proposed regulations.

Failure by the employer to provide paid family leave benefits to its employees renders them fully and directly liable to their employees for the benefits, and may subject the employer to a fine of up to one-half of a per centum of weekly payroll for the period the employer was without coverage, and an additional sum of not more than 500 dollars.

3. Costs

The costs to carriers, employers and employees across the state will be minimal, and the proposed regulations do not impose additional costs beyond what is set forth in the paid family leave statute that became effective on April 1, 2016. Additionally, paid family leave is an employee funded insurance product, so the employer may collect contributions from all its employees to pay the premiums for the insurance product. The cost is shared among employees, so the contribution is a modest deduction from each employee’s paycheck.

Insurance carriers will incur administrative costs associated with creating and carrying paid family leave insurance policies, as every carrier who offers short-term Disability Benefits is also required to offer paid family leave coverage. However, it is expected that the insurance carriers should recover those costs through the premiums charged for the coverage and paid by the employee contributions. There will be administrative costs associated with arbitration – the filing party will be responsible for a 25 dollar filing fee (the employee can be reimbursed if they prevail on the claim) and the carrier responsible for the arbitration fee for disputes: up to 350 dollars for desk arbitrations, which are the majority of arbitrations, or 450 if an oral arbitration is deemed necessary.

4. Minimizing adverse impact

The proposed regulations aim to minimize adverse impact for businesses and employees alike, by providing leave that allows employees to balance work and life. Employees pay for the insurance product through payroll deductions, but that cost is shared by all eligible employees, thus minimizing the burden on employees. In turn, employers do not have to pay for the benefit. Paid family leave provides an opportunity for financial security for employees while taking care of a family member in need, and also is expected to promote greater job satisfaction and thus employee retention when it becomes clear that they do not need to sacrifice their job in order to take care of important family obligations outside of the workplace. Overall, these benefits are expected to offset the compliance costs and any adverse impact on rural areas.

To further minimize any adverse impact on rural and other areas, the proposed regulations will be phased in over the course of a few years instead of all at once. The maximum benefit rate, as well as maximum benefit time, will range from 50 to 67% of average weekly wage and eight to 12 weeks from 2018 to 2021.

5. Rural area participation

Comments were received from the Business Council of New York State and the AFL-CIO regarding the impact on all of their constituents including those in rural areas.

1. Nature of Impact

The Paid Family Leave Act and proposed Part 380 of Title 12 of the NYCRR is not expected to have a negative impact on jobs in New York State. It is expected that job satisfaction will increase and employers will reap the benefits of that increase. Employees will be able to take family leave to care for a family member without the fear of losing their job. As has been the experience in other states that have adopted a paid family leave benefit, providing employees the flexibility of this benefit results in better employee retention and increased job satisfaction. The proposed regulations were drafted to minimize adverse impact on jobs in New York State and provide for a smooth implementation of the paid family leave statute.

2. Categories and Numbers Affected

Virtually every New York State private employer will be affected by the Paid Family Leave Act and the supporting regulations. However, by allowing employees to take this leave without fear of losing their jobs, it is anticipated that this will actually be a benefit to the employer. Employees in New York are also affected by the paid family leave regulations. Instead of possibly having to choose between taking leave to care for a family member and maintaining employment, the proposed regulations will allow a better balance of work and life responsibilities, leading to greater job satisfaction and job retention.

3. Regions of Adverse Impact

The Paid Family Leave Act and its supporting regulations will be implemented state-wide. Paid Family Leave is provided in an insurance product, and does not create a burden on employers or jobs in general. Accordingly, there are no specific regions of adverse impact. One possible adverse impact is that the employee taking leave will be absent from their job for a period of time. However, the benefit of being able to take paid family leave to care for family members, and the security of being able to return to work after leave, is expected to offset this impact and lead to greater job satisfaction and thus increased employee retention. This has been the experience reported by employers in other states that have adopted a paid family leave program.

4. Minimizing Adverse Impact

The statute provides, and the regulations support, a gradual phase-in of the family leave benefit. The maximum benefit duration is limited to 12 weeks when fully implemented, but to further minimize any adverse impact, the first year the benefit duration will be limited to eight weeks, then 10, then fully phased in at 12 in 2021. Similarly, the maximum benefit amount will be phased in at 50% of the average weekly wage in stages up to the full amount of 67% in 2021.

Also minimizing this possible adverse impact of having employees out on leave is the expected enhancement of life for New York State employees (and in turn, New York State employers) – when work and life balance can be met, and family members can be taken care of by employees without fear of losing employment, it is assumed that greater job satisfaction will result, and employees will be satisfied and stay at their current employment. This benefit has been reported by employers in other states that have adopted paid family leave.

The Chair and Board received approximately 117 formal written comments. Approximately 42 were form letters from employee advocacy groups. Approximately 14 were from individual employees, and the remaining 61 comments were submitted by associations representing businesses, insurance carriers, law firms, unions, and employees

All of the comments received were reviewed and assessed. The comments break down into several groups: 1) those addressing definitions and eligibility; 2) those addressing the administration of benefits; and 3) insurance carrier compliance and arbitration procedures. The full Assessment of Public Comment summarizing, analyzing, and responding to the comments received exceeds 2,000 words. This document is a summary of the full Assessment of Public Comment. A copy of the full assessment is posted on the Board's website at wcb.ny.gov.

A comment was received from an employee advocacy group suggesting that the definition of “wages” be amended to allow wages for tipped workers to be used when calculating their average weekly wage. Accordingly, section 355.9(19) has been amended to cross-reference section 357.1 of 12 NYCRR to explicitly provide that tips be included in the average weekly wage calculation.

The Board received several form letter comments requesting the removal of section 380-2.4(d), the provision permitting employers to begin taking payroll deductions for employee contributions beginning July 1, 2017, because it conflicts with WCL § 209(1), which states that employees shall contribute the cost of providing family leave benefits beginning January 1, 2018. However, WCL § 209(3)(b) states “no employer shall be required to fund any portion of the family leave benefit” and establishes June 1, 2017, as the date the superintendent of financial services shall set the maximum employee contribution, while reserving September 1 as the date setting the rates for every year thereafter. The Board believes the statute clearly envisions permitting employers to collect employee contributions after the superintendent of financial services has set the rates on June 1, 2017, “consistent with the principle that employees should pay the total costs of family leave premiums (WCL§ 209(5)).” The Board believes Section 380-2.4(d) accurately reflects the legislative intent of the statute, so no changes to the regulations have been made.

The Board received comments requesting the definitions of part-time and full-time employees be amended to account for employees with compressed work schedules that work longer hours but fewer days. Section 203 of the WCL requires employees to become eligible for family leave after either 26 weeks or 175 days of work, depending on their schedule. Paragraphs (a) and (b) of section 380-2.5 have been amended to apply the 26 week eligibility criteria to employees who work 20 or more hours per week, and the 175 day eligibility criteria to those who work less than 20 hours per week.

The Board received several form letter comments requesting section 380-2.5(b)(i) be removed because it reduces the amount of leave available to part-time employees. This section only adjusts the benefit amount so that payments are calculated based on the number of days worked per week. This section has been amended to conform to the changes to section 380-2.5(a) and (b), discussed above, concerning the eligibility criteria for employees.

The Board received comments which asked for the regulations to be amended to clarify whether leave designated by an employer as FMLA leave for an employee’s own serious health condition affects their PFL leave balance, and if FMLA leave for bonding is concurrent with family leave. Section 380-2.5(f)(1) (now 380-2.5(g)(1)), in accordance with section 206(4) of the WCL, permits an employer to designate an employee’s PFL leave as concurrent with FMLA leave. The Board has amended section 380-2.5(f) (now 380-2.5(g)) to also state that an employer may not count FMLA designated leave for an employee’s own serious health condition as family leave. Furthermore, if an employer designates a period of leave to be covered by the FMLA for a reason which the employee is also eligible to take family leave benefits under section 204 of the Workers’ Compensation Law, and the employee declines to apply for payment under section 380-5.1, the employer may count the period against the employee’s maximum leave in a 52 consecutive week period under section 204(2)(a) of the WCL. Section 380-6.2 has also been amended to clarify that the use of paid time off accruals during family leave by an employee of an FMLA covered employer is governed by the FMLA.

The Board received comments opposing the ability of an employee to waive PFL coverage and opt out of the employee contribution under section 380-2.6. The purpose of the waiver is to allow those employees that will not become eligible for PFL within a reasonable amount of time to avoid paying for a benefit they will not receive. The Board recognizes the need for clarity, and has amended this section to explicitly permit employees that will be employed for fewer than 26 consecutive weeks or 175 days in a 52 week period to waive coverage. The Board will develop a waiver form.

The Board received comments asking for section 380-2.9 to provide more detail about how a collectively bargained plan can take the place of an employer plan. WCL § 211(5) describes this process. Such plans must provide benefits as least as favorable as those provided in the statute. Section 380-2.9 has been amended to explicitly state that a collectively bargained plan may allow employees to establish their eligibility for benefits while working for multiple employers.

The Board received comments from insurance carriers and various advocacy groups regarding the requirement in the proposed regulations that certifications from medical providers of a family member’s serious health condition include the ICD-10 code for the diagnosed condition. These groups identified various concerns, ranging from possible delays caused by incomplete forms, to health privacy concerns. While section 380-4.2(a)(3) requires certification of a serious health condition from a health provider, in light of these comments, this section has been amended to remove the provision requiring that the ICD-10 code be included as part of that certification.

A comment from insurance carriers requested that employees submitting pre-filed applications for family leave more than 30 days in advance of their need for foreseeable leave (i.e. birth of a child), be responsible for keeping copies of their application until all necessary supporting information is available. Carriers commented that it would be overly burdensome to retain copies of incomplete applications and send applicants a list identifying the missing information. The Board has taken these concerns into account, and the regulations no longer require the carrier to send the employee the request for paid family leave in addition to a list of the missing information.

The Board received a comment from an insurance carrier asking that section 380-5.3(b) be amended to allow carriers to provide contact information for the applicable office instead of an individual contact person in their response to a pre-filed claim. The Board has amended section 380-5.3(b)(3) to allow the notice to include contact information for the applicable office.

Two comments from insurance carriers expressed concern that that section 380-5.4(e) directly conflicts with parts (b) and (c) of that section. However, the Board believes that these sections make clear that an employer’s refusal to comply does not constitute a valid reason for denial of a claim. The purpose of section 380-5.4(e) is to make clear that if the employer is not cooperative in the process, the carrier must reach out to the employer in order to complete the request for paid family leave and may not penalize the employee for the employer’s lack of cooperation.

The Board received several comments from insurance carriers expressing concern that complying with section 380-5.4(h) will be overly burdensome and prohibitively expensive. The Board will translate the request for paid family leave forms and instructions in seven languages, and has updated the regulation to take into account these concerns.

The Board received several comments from various associations and insurance carriers concerning the method of benefit payments in the proposed regulations. There were also concerns expressed about the ability of carriers to comply with the requirement of providing local access for ATMs and an accurate list of locations. The Board has taken these comments into account and has amended the provisions accordingly. Additionally, carriers are not required to provide payment by debit card or direct deposit. However, if the self-insured employer offers different methods of payment to their employees taking paid family leave, then the same payment provisions apply to the self-insured employer.

One comment requested the addition of a provision that the carriers specifically state the basis for their denial of a request for paid family leave. The Board has included language to require that the carriers specifically state the basis of a denial of a request for paid family leave.

One comment expressed concern that the proposed regulations only partially reproduced the relevant statutory penalties. Since penalties are in the statute, the Board has removed them from the regulations altogether to eliminate any confusion.

One comment requested that the regulations explicitly state that PFL contributions are required while the employee is out on either disability or paid family leave. Section 380-7.2 has been amended to add that an employer may continue to deduct employee contributions while an employee is receiving benefits under WCL section 204.

One comment from an industry association requested that the regulations explicitly permit the contributions for the paid family leave benefit to be calculated with Workers’ Compensation, Disability and other similar benefits provided under a collective bargaining agreement with a single contribution rate. Employee contributions for statutory workers’ compensation coverage is prohibited by law. The regulations are otherwise silent on how contributions are to be collected. The Board does not believe the regulations should address this specifically, but the collective bargaining sections of the regulations have been updated for clarification.

The Board received a comment from insurance carriers objecting to the requirement in section 380-7.8(d) that carriers provide proof of cancellation to the Board before each denial. This provision has been updated to clarify the intent of the Board that attaching proof of cancellation to each denial is not required.

The Board received a comment requesting that the SIC industry code of the employer be requested rather than NAICS. The Board is conforming to the Department of Financial Services’ regulations and only requiring the SIC code.

The Board received several form letter comments suggesting the removal of the requirement that workers file a formal request for reinstatement within 120 days of the alleged violation as a precondition to filing a complaint, including a suggestion that the formal request for reinstatement be optional, or that the deadline for filing such a request be extended to match the statute’s deadline of two years. The Board has updated the regulation to eliminate the 120 day requirement for the formal request for reinstatement. However, no change has been made to the requirement that the employee file a formal request for reinstatement prior to submitting a complaint.

The Board received a comment from an arbitration association stating that the language allowing an arbitrator and dispute resolution forum to become parties to a court proceeding relating to the arbitration award should be removed under the common law principle of arbitral immunity. The Board has removed this language and updated the regulations to reflect the common law principle of arbitral immunity.

The Board received a comment concerning public employers who choose not to provide PFL coverage and their ability to continue to voluntarily provide disability coverage under Department of Financial Service’s regulations. Public employers will continue to be able to purchase policies that only provide disability coverage.

The Board received several comments from small employers and individuals expressing concerns about the adverse effect of paid family leave on small employers. The statute defines a covered employer as an employer with one or more employees, and this cannot be modified by regulation. Therefore, no change has been made.