Best practices to consider for managing paid family leave
Last updated October 28, 2025
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While most businesses are familiar with the Family Medical Leave Act (FMLA) which has been in effect since 1993, leave regulation becomes increasingly complex with each passing year. Why? FMLA is a federal law that mandates job protections. However, as more individuals advocate for paid leave some states are enacting Paid Family and Medical Leave (PFML) laws. Keeping track of the various federal and state laws is a significant challenges in maintaining compliance with l laws. This article provides a basic overview of:
The evolving paid family leave landscape
For decades after FMLA came into effect, states, by and large, left paid leave policy up to individual employers. Businesses could choose to offer perks like paid medical, bereavement, or parental leave as part of their compensation packages — or not. In recent years, however, states have started to enhance leave protections in a variety of ways. For example, by extending leave periods or requiring businesses with less than 50 employees to offer protected leave, especially for maternity. And increasingly, states have started to adopt their own mandatory paid leave rules.
Several states, along with the District of Columbia, currently have paid family and medical leave (PFML) laws in place, although in some states, the mandates have yet to take effect. Most use a social insurance policy funded by payroll taxes, though New York uses a mandatory private insurance fund. Additional states, including Vermont and New Hampshire, have adopted voluntary paid family medical leave laws, which provide tax credits and other measures that make it easier for employers to provide paid family and medical leave insurance.
As paid leave regulations expand and change, employers are left struggling to keep up. A 2024 report from Guardian found that with the rise of PFML laws, four out of 10 employers said they were moving toward a broad leave policy instead of a separate policy approach.1
The same report notes that 73% of employers surveyed said that maintaining compliance with state and local laws was a significant challenge, which was a 7% increase compared to a 2016 survey. And, employers with workers in multiple states that have PFML laws are three times more likely to feel challenged by maintaining compliance with absent management regulations.
Considerations that go into an effective paid family leave program
Whether your organization is being mandated to offer paid leave or deciding to do so voluntarily, there are a number of things to consider before you start paying employees for time off:
Specific state and local laws
Nine states: California, Colorado, Connecticut, Massachusetts, New Jersey, New York, Oregon, Rhode Island, and Washington — and the District of Columbia now mandate paid family and medical leave, but each state has different requirements.
Four more states — Delaware, Maine, Maryland, and Minnesota — have passed PFML laws; with Delaware, Maine, and Minnesota going into full effect starting in 2026 and Maryland in 2028.
Hawaii and Puerto Rico having paid leave for disability only
If you operate in any of these states, your paid leave program, at a minimum, needs to confirm those specific requirements.
Define a clear and direct policy: You need to spell out who is eligible, what they’re eligible for, and under what circumstances.
Communicate: Once your policy is defined, documentation must be accessible, and policy terms and employee rights must be proactively communicated to employees, managers, and executives. Some states also require this information to be provided to new hires and provide updated notices annually as well.
Integrate: Ensure your paid leave policy is consistent with and reinforces your overall leave and absence management program and policies.
Paid leave policy design
When designing your paid leave policy, take the time to incorporate input from multiple stakeholders in the organization, and be sure to account for all of the following:
Multiple types of paid leave: Spell out what’s covered including sick/medical, family, bereavement, parental, caretaking, and disability leave. When employers are self-insuring or getting a policy through a carrier, the program must be equal to or better than the state plan.
Paid time off (PTO) and vacation time: Define processes for allowing employees to request time off for personal reasons.
Eligibility criteria: If applicable, be sure to include leave accrual rates.
Maximum leave allowances: Make sure to resolve any seeming conflicts between company policies, employee compensation packages, and both federal and state regulations.
Aligning paid leave with other benefits: Account for short-term disability or workers’ compensation benefits.
Streamlining administration: Look to unify the employee experience and administrative procedures across different leave types for improved absence management.
Communicating changes: As new policies are rolled out or changes are made to existing policies, ensure that these are communicated to employees and provide ongoing support for questions and issues.
Compliance with multiple sets of regulation
Different employment laws and regulations have varying requirements which may seem to conflict at times. To help avoid compliance issues and legal penalties, don’t hesitate to consult with a qualified labor attorney to ensure your policies are consistent with all of the following:
The Family Medical Leave Act (FMLA) requires that eligible employees can take up to 12 weeks of unpaid, job-protected leave under applicable circumstances.
The Americans with Disabilities Act (ADA) requires that employers provide reasonable accommodation when possible.
The Pregnant Workers Fairness Act (PWFA) gives employees the right to request and receive reasonable accommodation for limitations related to pregnancy, childbirth, or related medical conditions.
State and local paid and unpaid leave laws, including disability insurance provisions and regulations, which impact overall leave policy.
State-paid family leave program laws are regularly undergoing changes and should be closely monitored. An increasing number of employers are choosing to work with third-party resources to help manage ongoing compliance, administration, and documentation of leave and absence management.
Outsourcing Leave Management
Outsourcing leave management involves working with a third-party provider to implement a company’s PFML plan along with overall leave and absence policy, reducing administrative burden and enhancing compliance. Guardian, for example, offers fully insured, state-approved plans as part of a guided leave and absence management experience for employers. This helps them develop and implement leave management processes that integrate with disability to provide the following benefits:
Ensure compliance with all state and federal regulations.
Optimize productivity by supporting return-to-work and stay-at-work strategies.
Provide access to self-service claims information, including the options to enter absences or return-to-work dates, electronically sign releases, and upload documentation.
Proactive outreach from leave and clinical professionals to support a safe return to work for employees.
Assessment and continual improvement of existing absence management efforts.
Learn more about Guardian’s Absence Management Solutions
Note that outsourcing leave management differs from "opting out" of state programs. Some states have PFML laws that allow employers to opt out of the state-paid leave program if they offer a private plan with the same or better benefits.
Future trends and things to consider
Comprehensive paid leave programs are increasingly important to employees. Employers should consider the following best practices to stay on top of paid leave trends:
Align leave management policies with long-term goals and corporate objectives.
Compare your paid leave benefits and policies against other in-market organizations to help ensure you’re competitive.
Create policies that are clear, direct, and easy to understand and interpret.
Leverage internal data and external market research to consider how your policies address your employees’ needs.
Stay up-to-date on local state laws, state precedents, and precedents set by your own company. You can subscribe to our Absence blog to help you stay abreast of the latest regulatory news and information impacting employee leave, including federal and state legislative updates.
Need more information?
Sign up for our Absence Management webinar series | Explore the Guardian Absence Management hub | Subscribe to the Absence Management Blog |
Frequently asked questions about paid family leave
The Family Medical Leave Act (FMLA) provides eligible employees with up to 12 weeks of job-protected and unpaid leave annually for qualifying circumstances, such as to take care of their own serious health condition or that of a family member, or for pregnancy, childbirth, and bonding with a new child. FMLA also covers military leaves, and an employee may also qualify for 26 weeks of leave under USERRA. Employees are guaranteed to return to the same or an equivalent position and cannot face discrimination for taking family medical leave. Benefits are also protected under FMLA.
The Family Medical Leave Act (FMLA) is a federal law that guarantees eligible employees the ability to take up to 12 weeks of unpaid leave off per year due to medical or family concerns, including serious illness or injury or taking care of a family member. The FMLA applies to all states, and it requires that employees are able to return to the same or an equivalent position when their leave is over.
Paid family leave (PFL), however, is not a federal regulation or mandate. Multiple states and the District of Columbia currently have PFL policies, which allow eligible employees to receive pay while taking medical or family leave. These programs may or may not provide job protection and often run currently with state and federal unpaid leaves.
Some states have PFL laws, but while eligibility and benefits vary significantly from state to state, an employee can't get benefits after they quit in some cases. The main exception is California, where a worker who voluntarily quits their job to care for a family member with a serious health condition may still be able to receive PFL benefits if otherwise eligible.2 Similarly, Connecticut, New Jersey, Massachusetts, and Washington state have similar exceptions, provided the employee meets other eligibility criteria. And even more states require the payout of accrued vacation or other PTO, even after an employee quits or is terminated.3