Dear Valued Customer,
In 2020, calendar revisions to the following State laws will take effect: Temporary Disability and Family Temporary Disability Leave (TDB), Family Leave (FLA), and Domestic or Sexual Violence Safety Leave (SAFE).
Guardian will provide you with overviews of the benefit changes directly impacting your private Temporary Disability Benefit (TDB) plan, as well as changes to the state Family Leave Insurance (FLI) program.
Since the amendments to the state laws were passed earlier this year, some provisions are already enacted, while others will become active over the upcoming year. We recommend that you review the enhancements and familiarize yourself with your obligations under the law to ensure your compliance.
Highlights of the Legislative Changes impacting Temporary Disability Benefit (TDB) and Family Leave Insurance (FLI) coverage:
Effective February 2019 to July 2019:
- Job protection, under the FLA Act, is expanded to employees of businesses employing 30 people or more, and now also extends protection to employees under both the Family Leave Insurance (FLI) and Temporary Disability Benefits (TDB) programs.
- The “family member” definition was significantly broadened.
- FLI and TDB coverage is expanded to include victims of domestic or sexual violence.
- The FLI waiting period of seven calendar days is eliminated. The waiting period is still applicable under Temporary Disability Benefits (TDB).
Effective January 1, 2020:
- Both the Employee Contribution rate and taxable wages subject to contributions will increase significantly to absorb the cost of the expansion of benefits for 2020. While the employer taxable wage base will remain 28 times the NJ Statewide Average Weekly Wage (SAWW), the employee taxable wage base will increase to 107 times the NJ SAWW.
- For TDB, the employee contribution rate will increase to 0.26% of an employee’s wages, up to the maximum taxable wage base of $134,900; maximum annual contribution of $350.74 for 2020.
- For FLI, the employee contribution rate will increase to 0.16% of employees’ wages, up to maximum taxable wage base of $134,900; maximum annual contribution of $215.84 for 2020.
- The benefit percentage and weekly benefit maximums for both TDB and FLI, will remain 66.67% of employees’ average weekly wages, up to an increased maximum benefit of $667 per week.
Effective June 17, 2020:
- NJ TDB will allow employees to return to work on a reduced schedule and be eligible for partial disability benefits, provided their employer is agreeable. The benefits will last up to eight weeks, or up to 12 weeks if medically warranted.
Effective July 1, 2020:
- The benefit percentage and weekly maximums will increase for both TDB and FLI. Benefits will increase to 85% of an employee’s average weekly wages, up to a maximum of $881 per week.
|Employee/Annual Salary||Avg Weekly Salary||Jan 1 to Jun 30, 2020
Eligible Weekly Benefit
66.67% to max $667
|Jul 1 to Dec 3, 2020
Eligible Weekly Benefit
85% to max $881
|Employee A- $75,000||$1,442||$667||$881||+$214|
|Employee B - $52,000||$1,000||$667||$850||+$183|
|Employee C - $45,000||$865||$577||$735||+$158|
- The duration of Family Leave Insurance (FLI) will increase from six weeks to 12 weeks of paid leave in a 12-month period. For family leave used intermittently, the maximum allowable days will increase from the current 42 days to 56 days.
For more detailed overview of the 2020 NJ TDB rate and benefit provisions that will impact your Guardian private plan, please review the 2020/2019 Benefit Provision Comparison. For more details concerning Family Leave Insurance (FLI), please visit the New Jersey State website.
What Employers Should Do Now
- Educate yourself and your administrative teams on the revised laws concerning TDB and FLI benefit changes and employer requirements.
- Consult with your payroll department and/or payroll vendor to confirm it’s prepared to update the payroll system to properly administer the appropriate payroll deductions for both TDB as private plan and FLI as a state plan, effective 1/1/2020. As the employer, you are responsible to ensure the correct employee deductions are applied, as per the state guidance.
- Update your current Company Leave Policies/Employee Handbooks and make any needed updates to reflect the updated NJ State mandated benefit provisions.
- Advise your employees of the updated benefit provisions taking effect 1/1/2020 and inform them of their updated payroll deduction rate for these benefits.
What Guardian is Doing to Prepare
- We are educating our Staff and updating our systems and materials in preparation of the upcoming benefit changes to ensure our NJ TDB private plan is in full compliance and we are prepared to assist you and all our Guardian customers.
- We are updating our Guardian Premium Reports for 2020 to accurately account for premium contributions based on the separate taxable wage maximum; employee and employer.
- We are preparing amendments to policy documents, as required by law. Guardian will issue a policy amendment rider, no later than January 31, 2020, advising of the benefit and rate revisions to your current policy.
If you still have additional questions, we can help. Please feel free to contact your Guardian Broker or Sales Consultant. Our Customer Response Unit is also available at 1-888-278-4542 or CRU@glic.com.
We appreciate your business and thank you for the opportunity to help you and your employees.
The Guardian Life Insurance Company of America