Massachusetts cuts employer bills for paid family, sick leave

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This article first appeared in the Boston Business Journals’ website.

The Baker administration announced Friday that employer costs for the state’s paid vacation program will fall over the next year, although workers will be entitled to more benefits thanks to rising wages across the country.

For every $ 100 of eligible employee wages in 2022, the state will be owed 68 cents towards the paid family and sick leave program. That’s less than 75 cents this year. The tariff applies to companies that have not deregistered from the government program for any of the alternative tariffs offered by insurance companies.

Many employers will be responsible for a little less than half what the state pays, 33.6 cents for every $ 100 of eligible wages. However, companies with fewer than 25 insured employees do not have to pay into the holiday fund themselves. The employees are on the hook for the remaining amount, although companies have the option of taking over this part in whole or in part.

Business groups had raised concerns that the cost of paid vacation could rise over the next year, as 2021 marks the first year that entitlements have been paid since the program was made legal in 2018.

While employers may deposit less into the state fund in 2022, the maximum payouts from the fund will increase.

The government announced on Friday that the state’s median weekly wage rose to $ 1,694.24, up 14% from the previous year. In response to difficulties finding workers during the pandemic, companies have raised wages.

The vacation pay is linked to the average weekly wage. This year the maximum payout is $ 850 per week. Over the next year, this will climb to $ 1,084.31 per week.

A spokesman for the Executive Bureau for Labor and Human Resources Development immediately responded to questions about the pay change.

The state Department of Family and Sick Leave paid a total of $ 168 million in benefits and approved 43,440 vacation requests between January and June.

For the fiscal year ended June, the state raised a gross $ 987 million for the vacation fund.


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