Updates to the California Family Rights Act (CFRA)
Updates to the California Family Rights Act (CFRA)
On March 4, 2015, The California Fair Employment and Housing Council (FEHC) filed updated regulations for the California Family Rights Act (CFRA) to be effective July 1, 2015. CFRA has not been revised in twenty years and there are three general areas of change. These updates will better align CFRA with the federal Family and Medical Leave Act (FMLA), clarify the differences between FMLA and CFRA, and clarify confusing areas.
Changes to Better Align CFRA and FMLA.
- Employers will be required to respond to CFRA requests within five days instead of ten days.
- The updated regulations will change how leave entitlement is calculated in order to accommodate variable schedules.
- The new CFRA regulations will allow employers to retroactively designate leave as CFRA as long as the employee is given notice and it does not do any harm to the employee.
- The location to which a remote employee is assigned or reports will be considered the employee’s “worksite.” This update is significant because some employers may see an increase in CFRA eligible employees.
- A “joint employer” will be defined under CFRA instead of just referencing the definition under FMLA.
- A “serious health condition” under CFRA is expanded to cover treatment for substance abuse.
Changes to Clarify Differences Between FMLA and CFRA
- CFRA will continue to provide greater privacy protection for employees. Under CFRA, employers still cannot ask for a diagnosis or contact the health care provider to clarify information on the medical certification. Employers can only authenticate information.
- Second opinions will only be permitted for the employee’s own serious health condition, not for a family member’s serious health condition.
- The definition of “inpatient care” is being expanded to include the expectation of staying overnight in a facility, even if the patient is released.
Changes to Clarify Confusing Areas of CFRA
- The definition of “spouse” will include married same-sex partners and registered domestic partners.
- If an employee is receiving partial wage replacement (disability or paid family leave benefits) during the CFRA leave, employers will be prohibited from requiring California employees to use their accrued vacation or PTO while out on leave.
- The new regulations will clearly state that fraudulent use of CFRA leave will nullify an employee’s protected job restoration or maintenance of health benefits rights. (Employers bear the burden of proof).
Since these updated CFRA regulations go into effect on July 1, 2015, employers in California should take a look at current policies to ensure consistency and compliance and have them reviewed by legal counsel. Please note that the changes listed above are not inclusive of all the changes, but cover many of the key points. For more information, please see http://www.dfeh.ca.gov/res/docs/FEHC/Final%20Text%20(1).pdf. Otherwise, please contact the Larkin Company for further information or questions.
California EDD Updates 2016 DI Fund Forecast
California State Disability Insurance Fund Forecast for 2016
The California Employment Development Department (EDD) has announced its May forecast for the 2016 Disability Insurance (DI) Fund. The DI fund provides State Disability Insurance and Paid Family Leave benefits for California employees. The 2016 employee contribution rate is expected to increase from 0.9% to 1.0%; the maximum weekly benefit is expected to increase from $1,104 to $1,144; and the taxable wage base from which DI contributions can be made is expected to increase from $104,378 to $108,160.
California employers may opt out of the state DI if a private plan, Voluntary Disability Insurance (VDI), is established and certain requirements are met. Two of these requirements are that the employee cost of VDI cannot be more than what the employee pays for DI and the benefits paid by VDI must be at least equal to what DI would pay. For more information about VDI, please contact The Larkin Company.
Once the DI changes for 2016 have been finalized, The Larkin Company will reach out to clients for whom we administer VDI to assist them in planning for 2016.
California EDD Updates for 2015 DI Fund and Equitable Parental Leave
California State Disability Insurance Fund Changes for 2015
The California Employment Development Department (EDD) has announced the changes for the 2015 Disability Insurance (DI) fund, which provides State Disability Insurance and Paid Family Leave benefits for California employees. Effective January 1, 2015, the employee contribution rate will decrease from 1.0% to 0.9%; the maximum weekly benefit amount will increase from $1,075 to $1,104; and the taxable wage limit from which DI contributions can be made will increase from $101,636 to $104,378.
Equitable Parental Leave for Bonding
On July 14, 2014, The Equal Employment Opportunity Commission (EEOC) released updated guidance on parental leave for bonding, both paid and unpaid. The EEOC specified the requirement for equitable parental leave in order to comply with Title VII of the Civil Rights Act of 1964, which prohibits employment discrimination from disparate treatment between new mothers and new fathers. To avoid violation of Title VII, employers must differentiate between leave to recover from a disability from leave to bond with a new child. While employers can offer leave or pay to employees who give birth to recover from pregnancy and childbirth, new mothers and new fathers must be eligible to receive the same amount of parental leave or pay to bond with a new child.
To explain this further with an example, if an employer offers a pregnant employee 12 weeks of “maternity pay,” then 8 weeks is income replacement to recover from pregnancy and childbirth and the remaining 4 weeks is to bond with her new child. Therefore, a new father or non-biological mother should also be eligible for 4 weeks of parental pay to bond with his or her new child. This ensures the employer is offering equitable parental leave and not violating Title VII.
The Larkin Company will reach out to our clients for whom we administer Leave of Absence or Voluntary Disability Insurance plans to assist them in planning for 2015.
California State Disability Insurance Fund Forecast for 2015
The California Employment Development Department (EDD) has announced its May forecast for the 2015 Disability Insurance (DI) Fund, the fund from which both State Disability Insurance (SDI) and Paid Family Leave benefits are paid. The 2015 employee contribution rate is expected to decrease to 0.9% from its current 1.0%; the maximum weekly benefit amount is expected to rise to $1,111 from its current $1,075; and the taxable wage base from which DI contributions can be made is expected to rise to $105,040 from its current $101,636.
California employers may opt out of DI if a private plan, Voluntary Disability Insurance (VDI), is established, provided certain requirements are met. Two of the primary requirements are that the employee cost of VDI be no more than the employee cost of DI and that benefits paid by VDI be at least equal to what DI would pay.
Once the DI changes for 2015 have been finalized, The Larkin Company will reach out to clients for whom we administer VDI to assist them in planning for 2015.
Rhode Island Temporary Caregiver Insurance
As of January 5, 2014, Rhode Island began accepting Temporary Caregiver Insurance (TCI) claims after the program was established last July by House Bill 5889. TCI provides up to four weeks of benefits and pays up to $752 per week to claimants who require time off for at least seven continuous days to bond with a new baby or care for a seriously ill parent, child, domestic partner, spouse, grandparent or parent-in-law. Though Rhode Island has just implemented its paid family leave program, California and New Jersey both have such programs in place.
California became the first state to implement a paid family leave program, and it provides up to six weeks of benefits to employees who require time off work to bond with a new baby or care for a seriously ill spouse, child, parent or registered domestic partner. Beginning July 1, 2014, the newly expanded definition of family member will become effective to include grandparents, grandchildren, siblings and parents-in-law.
New Jersey was the second state to begin operating its paid family leave program, called Family Leave Insurance (FLI), which was integrated with New Jersey’s existing Temporary Disability Insurance program. FLI provides up to six weeks of benefits to bond with a new baby or care for a seriously ill child, spouse, domestic partner, civil union partner or parent.
Though Washington has passed legislation that establishes its paid family leave program, the program’s implementation has been delayed until 2015. Unlike California, New Jersey and Rhode Island, Washington has no statutory disability program and thus no existing vehicle through which to fund its paid family leave benefit.