What do we know about Colorado PFML?

On November 3, the residents of Colorado voted to pass Colorado Paid Family and Medical Leave, making it the 9th state with a paid family leave law.  In this episode of Lincoln Absence Advisor, Lincoln’s Kristin Hostetter, product lead for PFML programs, and Sarah Montgomery, general counsel share what they know about the program in our first conversation on this state.


LCN-3328189-111220 
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Transcript

Karen Batson: 0:01

Hi again, everyone. This is Karen Batson marketing manager for leave and disability at Lincoln Financial Group. It is time to talk about a new paid family and medical leave program. Colorado is the newest state to join the ranks and we are here to talk about what we know. Join Lincoln's Kristin Hostetter, product lead for PFML programs and Sarah Montgomery general counsel, as we discuss the preliminary info from the state and what this will mean for employees in the future. Welcome ladies. Thank you for joining me today.

Kristin Hostetter: 0:30

Thanks so much for having us, Karen.

Sarah Montgomery: 0:32

Thank you always good to talk about another leave program with you.

: 0:36

Love it. So on November 3rd the residents of Colorado voted to pass the Colorado paid family leave program. Um, making it the ninth state to have a paid family, leave law. One of the first questions I have to ask both of you though, because I really just don't know is, has a PFML or PFL program been on the ballot before in order to move forward.

Sarah Montgomery: 0:58

As far as I know this is the first one out of the nine, that exists that have been ballot initiatives. And I think this was mostly because Colorado just had a hard time getting the bill that was introduced last year and the legislature pushed forward. And when the legislature went out of session and the proponents of the bill moved to the ballot, alternative gathered signatures and were able to get it on the November ballot in time, even through Corona, which was quite impressive. Trying to gather signatures. It was a great effort.

Karen Batson: 1:27

Now, Kristin, you're in Colorado. So as a resident, was this a topic of conversation around the election? Did you hear any word on the street?

Kristin Hostetter: 1:36

Yeah, it's, it's funny. Cause it's been a topic of conversation for quite a while. Actually, as Sarah mentioned it, it didn't start as a ballot initiative. It started as something else. And so we thought maybe it would pass through the legislative process last year, which didn't happen. And it's been interesting over the last few months, like I'll go to the grocery store and see people out collecting signatures and taking all of the COVID precautions, which is really kind of interesting to see. And it has been a topic ever since then. So it was kind of exciting to watch the results come in and see this one path.

Karen Batson: 2:10

That's great. Especially so connected to what you do day to day. I just think y ou must find it fascinating.

Kristin Hostetter: 2:15

Absolutely.

Karen Batson: 2:16

So today's chat is just to kind of, it's going to be a quick check because we probably don't have a ton of information, but just kind of walk through what we know, um, and get this information out to our listeners. So how about we start with, what are some key dates that we know for this program coming to life?

Kristin Hostetter: 2:32

Sure. I can take that one. So I think maybe I'll start with probably the most important date to a lot of people that may be able to receive benefits through this program and work backwards. So January 1st, 2024 is when the program takes effect and benefits are payable and then kind of backing out from there in January of 2023 employee and employer contributions begin and then closer to us than that point in January of 2022, we expect regulations to be adopted.

Sarah Montgomery: 3:06

Yeah, so we would probably anticipate Kristin between now and all of 2021 for the new department to get up and running, to get budgets, to try to do hiring, to try to get ready, do outreach to states. What's been really good is the states that are bringing programs on, have done outreach to the states that have just established programs to kind of learn best practices. So, we expect a lot of that kind of activity t o be taking place in 2021.

Karen Batson: 3:33

So knowing that we'll probably get information in pockets, maybe a little in 2021, but definitely after, um, I won't hold you to any, too much detail as we walk through some of the program overview, but just talk about what we know. Um, can we walk through the benefits of the program, like how much leave will be available and what leave reasons we know will be covered?

Kristin Hostetter: 3:56

Sure. So it's a, it's a 12 week benefit. There's much like a lot of the States that have recent paid family and medical leave programs. There is an additional allotment for pregnancy and childbirth related complications. So generally it's 12 weeks. There could be an additional four for that particular reason. And then it covers what we commonly see under most paid family leave programs. Care for a seriously ill family member, bonding, the exigency reasons when a family member is called t o active duty, safe leave due to domestic violence, and then again, kind of more common with some of the more recent programs, this one also includes an employee's own serious health condition.

Karen Batson: 4:38

So overall from what we know does the program feels pretty consistent with other programs we've seen of late.

Sarah Montgomery: 4:44

It does. We're starting to see too, this one. So, you know, the leave reasons are the same, the durations are similar and we're starting to see the carrying through of the expanded family member definitions, you know, in Colorado. It's all the typical categories we've seen recently, child parents, spouse, domestic partner, grandparent grandchild siblings. U m, and with the addition of the c atch, a ll kind of what's known as the affinity r elationships. So you can also take leave for a person who is part of your family, but i s not related to by blood. So it's close personal relationships that are like family, which is going to, you know, as just a recent extension with some of the new lead programs we've been seeing that they're also moving to affinity relationship.

Karen Batson: 5:28

So what can we expect for the employee in regards to benefit amounts that are available to them through this program?

Kristin Hostetter: 5:34

I think this is going to be similar to other States too. So it's a tiered benefit structure. It'll kind of evolve over time, much like we've seen in other States. In 2024, the maximum benefit will be$1,100. And then in 2025, the maximum weekly benefit will go to the state average weekly wage, which is common with some of the other programs.

Sarah Montgomery: 5:57

Yeah. And what we're seeing with Colorado that matches what we've seen in other States too, is with the tiered benefit structure, it does a higher portion of wage replacement for lower income workers. So you get 90% wage replacement for the portion of your wages that are 50% below the statewide average weekly wage. So again, it's doing higher wage replacement for lower income workers and then a tiered structure that replaces less income of a certain amount of income that is over the statewide average weekly wage.

Karen Batson: 6:29

So when we talk about contributions in order to get that benefit, is this program a hundred percent employee paid or another path?

Kristin Hostetter: 6:37

This one is it's a split between employers and employees so that the funding will be 0.9% of wages per employee. And that funding is split equally between the employee and the employer. Um, that's not to say that the employer can't pick up more of that, but certainly they can't pay less than 50% of that.

Sarah Montgomery: 6:57

Yeah, and that law does allow for an increase in the premium contribution to go up to 1.2% after 12/31/24. But after that, it's, um, that's the only cap that's written into the law right now.

Karen Batson: 7:11

So is there, and we may not know the answer to this, but is there any information on whether private plans will be an option for this program?

Kristin Hostetter: 7:18

Yeah. Good news. There, there will be an option for private plans. I think we're still probably awaiting a lot of the details, but there certainly will be ASO programs allowed and the law does contemplate fully insured offerings as well. So employers will have a choice to make as to whether they want to go with a private plan or participate in the state plan.

Karen Batson: 7:39

Now kind of last question on the program overview is, is there anything of interest that, uh, we want to provide our listeners that we didn't cover already?

Sarah Montgomery: 7:48

I think we've done a good job covering what we know at the moment, as far as there is like when these programs start its, you know, everybody looks and says, Oh my God, well, you know, wants to dive into the details. There is, we have a long runway on this program, but yeah, well I say that now it's a long runway, but it'll be here before. We know it like with most of these programs that a year can go by very quickly. Considering we are standing up two programs next year with Oregon and Connecticut. So it's going to go by very quickly and Colorado will be up next before we know it. But I think they'll be doing a tremendous amount of organizational work in 2021 and doing outreach, coalition building, stakeholder input, all of those really important activities that States need to undertake to make sure they're building a program that makes sense for their population and really do that information gathering stage, which they have next year to do, and then spend also start drafting regulations. So there there'll be a lot of activity, but we won't be able to...there won't be a lot of things for employers to think about until regulations are issued, that we can really start putting meat on the bare bones of this program that we're seeing right now.

Karen Batson: 8:54

And that was going to be my question, what employers should be doing right now, but really it seems like just keeping themselves educated if something comes up. Is that the case?

Kristin Hostetter: 9:02

I think so. I think as Sarah mentioned, there's, there'll be a lot of information gathering over the next year and it'll really just be education for employers. Especially as we move into 2022, as more information becomes available, it will be making sure that employers find ways to obtain and consume that information. And then just keeping in mind that this program is out there and that it's going to be effective soon as they contemplate other paid leave programs that they may have and how this could potentially interact with them.

Karen Batson: 9:32

So how can our listeners stay apprised of new information about the Colorado PFML program?

Sarah Montgomery: 9:38

They can always check back with us because we stay on top of all of this stuff. This is now that it's up and running. It's added to our roster of things we're looking at closely and staying, um, you know, we'll be watching closely. You know, the good news is the employers, they know the contribution amounts. So they'll start being able to think about, you know, how to set up payroll deductions and then to start thinking about, as Kristin mentioned, the really important coordination of this program with other existing programs start thinking about whether they need to make any changes to their existing leave policies. Those are things that they could start thinking about now. And as we hear more, we will be doing more podcasts and keeping everybody aware of any information we get as we get it.

Karen Batson: 10:21

Well, thank you both for joining and doing this kind of quick conversation on our newest program. I'm sure you guys will be back in. We'll go into more detail, when we know it.

Kristin Hostetter: 10:30

We will. Thanks Karen.

Sarah Montgomery: 10:31

Thank you Karen.

Karen Batson: 10:33

To everyone listening. Thank you for joining us. We will continue to cover topics that help employers and their employees navigate through this new environment. So be sure to subscribe to Lincoln Absence Adviser on Apple, Spotify, or wherever you get your podcasts.

Disclosures: 10:48

The information contained in this podcast is for general use and is not a substitute for the advice of an attorney or your human resource professional. Lincoln Financial Group is the marketing name for Lincoln national corporation and its affiliates. Affiliates are separately responsible for their own financial and contractual obligations.