How Do Multistate Employers Navigate State Paid Family Leave Laws?

Often, with difficulty. Indeed, being a multistate employer can be daunting.

These employers must consider payroll and taxes in multiple states. Time changes for meetings can be tricky. Managing remote employees in various states can lead to questions of productivity and efficiency.

Juggling a job and a new child is no small task either. Add caring for aging parents to the mix and teenage mental health issues and that’s an employee whose family has a lot going on.

When an employee needs time off to care for an ill family member or bond with a new baby, many multistate employers must grapple with varying paid and unpaid family and medical leave laws.

And that’s if an employee is eligible for paid family leave and they are in a state that provides for it.

Let me back up.

In the U.S., employers are not legally obligated to provide paid family leave. The federal government does not provide paid family or medical leave either.

That said, employers with more than 50 employees within a 75 mile radius must provide leave per the Family Medical Leave Act, a federal law entitling eligible employees to up to 12 weeks of job-protected unpaid leave in a year for certain family and/or medical reasons, including baby bonding or caring for a close family member with a serious health condition.

But…by its terms, the FMLA excludes a whole swath of employers from having to provide leave, and the FMLA does not allow for leave for newer employees. An employee is “eligible” for this leave if the employee worked for the employer for 1,250 hours and for at least twelve months.

This can be tough for employees who discover they are pregnant when starting a new job or for employees contending with an emerging illness with their parents, children, or other close family members (defined by the statute).

On the other hand, some states provide for paid family leave, which allows employees to receive compensation for taking time off work to care for newborns, newly adopted children, or ill family members.

Sometimes, the state pays for family and medical leave. Sometimes, the employer or employee pays a portion of the leave. And some states finance this leave by combining payments from each stakeholder: the employer, the employee, and the state.

Which paid leave law applies?

Generally, leave laws apply to employees based on where the employee works.

Some states require a certain number of employees in-state for the family and medical leave law to apply, and others count the total number of employees.

For example, if an employee works in Oregon, Oregon’s new paid family leave law (which started this month) will apply even if the employer is based in Idaho. Most people, full- and part-time, who work in Oregon are covered by the new law.

Colorado is another one. Now that Colorado‘s state-run paid family and leave insurance program begins in January 2024, Colorado has joined the thirteen other states that currently mandate leave. Private employers with at least ten employees as well as employees also contribute premiums to the state to help finance the program.

Then, there’s the New York paid family leave program providing for wage replacement of up to $1,131.08 per week, and, the OG, of course, California.

This New York Times article explained that this year, Minnesota and Maine, along with the District of Columbia, now offer paid caregiving leave. The programs cover all eligible workers and are financed either by workers alone, or workers and employers.

Depending on the state, paid family leave policies cover between 60-100% of a paycheck up to a predetermined cap, for six to 12 weeks.

Recently, bills were introduced in Illinois, Michigan and Pennsylvania, among others, and by the end of 2026, 18 states will have joined the trend, including Delaware, Maine, Maryland and Minnesota.

How Can Multistate Employers Navigate Such Variegated Terrain?

First, employers need to identify and track where their employees work and if a paid family and medical leave law applies to each employee.

Eligibility is key and varies by state. For example, the Times explains that in Massachusetts, the state’s benefit of 12 weeks’ paid leave with job protection is available only to workers who earned at least $6,000 over the past (calendar) year, while in Rhode Island, that same worker would have to make at least $15,600 to be eligible for just six weeks of job-protected paid leave.

Second, and I’m sure a surprise to exactly no one, employers should consult with legal counsel or knowledgeable HR professionals who understand the state-specific regulations to navigate these laws effectively.

Third, set google alerts for paid family leave in states where you have workers. Staying updated on changes to state laws is crucial to maintain compliance.

Fourth, maintain written policies explaining when and under what circumstances employees are eligible for paid family and medical leave in any given state and provide information to employees about how to access these benefits.

And, explain how such laws interact with other leave laws, like the FMLA or state paid sick leave laws.

Fifth, and as is the case with most employment issues, train your managers not to discriminate or retaliate against employees who exercise their rights under these paid family leave laws.

The temporal proximity of a termination or demotion with an employee’s leave may become a critical factor in a retaliation claim.

Confused? Go back to Point #2, and consult counsel well-versed in multi-state employment issues.