June 11, 2019
Employment Law Alert
Employment Law Alert
Author(s): Jeffrey B. Gilbreth
Massachusetts Governor Charlie Baker and legislative leaders have announced an agreement to delay the effective date for the new Massachusetts Paid Family and Medical Leave Act payroll tax from July 1, 2019 to October 1, 2019.
Massachusetts Governor Charlie Baker and legislative leaders have announced an agreement to delay the effective date for the new Massachusetts Paid Family and Medical Leave Act (the “Act”) payroll tax. The delay will push out until October 1, 2019 (from July 1, 2019) the date on which employers must begin collecting a payroll tax associated with the Act from their Massachusetts workforce.
The joint statement from Governor Baker and the legislative leaders explained that the delay is to “ensure businesses have adequate time to implement the state’s Paid Family and Medical Leave program.” This delay will also provide time for the Department of Family and Medical Leave (the “DFML”) to issue further guidance and clarification with respect to various aspects of the Act. Because of this delay, the first tax payment from employers will be due by January 31, 2020, and this payment will be for the tax on all covered wages paid from October 1, 2019, through December 31, 2019. It is anticipated that the payroll tax rate will be increased to 0.75% (from the current 0.63%) when the payroll tax takes effect on October 1, 2019. However, that increased tax rate has not yet been confirmed—it was not part of the announcement from Governor Baker and the legislative leaders.
It is also currently unclear if the current June 30, 2019, deadline for employers to hang workplace posters and send notifications to their MA workforce will also be delayed.
We will issue additional updates as more information becomes available.
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