Guest guest Posted June 28, 2004 Report Share Posted June 28, 2004 www.sfgate.com Return to regularview A break for state's families - Kathleen PenderSunday, June 27, 2004 Starting Thursday, thanks to California's new paid family leave program,most employees in the state will be able to collect part of the wagesthey lose when they take time off to care for a seriously ill familymember or bond with a new child. Other states will be closely watching the program, the first of its kindin the nation. The new program has been folded into the state disability insuranceprogram, which partially compensates workers when they lose wagesbecause of their own serious illness or non-workplace injury. To pay for benefits, the state on Jan. 1 added a family leave tax to thestate disability insurance tax that is withheld from employee paychecks. Anyone who pays into the state disability insurance program is eligiblefor family leave benefits. This includes most employees in California,excluding some government workers. Self-employed people are eligibleonly if they participate in the disability insurance elective coverageprogram. Employers will not pay into the fund, nor will they have to provide anynew leave rights or job guarantees that are not required under federaland state family leave laws. The new program was created by the state Legislature and signed byformer Gov. Gray in 2002. Employees can file a claim to recoup part of their lost wages when theytake time off work to care for a seriously ill spouse, parent, child ordomestic partner, or to bond with a newborn, adopted or foster child. Eligible employees will get about 55 percent of their pay, up to acertain maximum, for up to six weeks in each 12-month period. The six weeks do not have to be taken consecutively. They can be takenin increments as short as one hour, "as long as you can demonstrate awage loss," says Suzanne Schroeder, a spokeswoman with the stateEmployee Development Department. The maximum an employee can receive is $728 per week in 2004 and $840 in2005. The Internal Revenue Service has told the department that family leavebenefits, unlike regular state disability benefits, are taxable. Thedepartment is appealing that decision. Waiting periods There is a seven-day waiting period for benefits, as there is withregular state disability insurance. Employees must be off work for seven days, which don't have to beconsecutive, before they can receive family leave pay. They may receivesick or vacation pay from their employer during the waiting period. This seven-day waiting period applies to each separate illness. Suppose your mother gets cancer and you take off work once a week totake her for treatment. You can begin collecting benefits for youreighth day off work, assuming you received no wages and met all othereligibility requirements. Now suppose your son has his appendix out. You must be at home with himfor seven days before you can begin collecting benefits for his illness. Now suppose your family is having its worst year ever, and your mother,who has finished her cancer therapy, has a stroke. You must serveanother seven-day waiting period. No matter how many illnesses befall your family, you cannot collect morethan six weeks of benefits in one 12-month period. There is one exception to the seven-day waiting period. If a pregnantwoman fulfills the seven-day waiting period and collects statedisability insurance for her own condition, then remains out on leave tobond with her new baby, she will not have to wait seven days before shecan collect family leave benefits for newborn care. "Otherwise, a new seven-day waiting period applies to each person youare caring for or each situation," says Hope Anne Case, a partner inEast Palo Alto with the law firm Gray Cary Ware & Freidenrich. New-baby benefits A mother or father can each claim family leave benefits for up to a yearafter a child is born, adopted or placed in foster care. "If you had your baby in March 2004, you have until March 2005" to taketime off and get benefits, says Case. Even if you had your baby in the last half of 2003, you may be able toclaim benefits this year. Benefits for baby bonding end when the childis 1 year old. The department has already received about 2,100 claims for family leavebenefits. "Over 90 percent are for bonding, and virtually all are forthe full six weeks," says the department's Schroeder. No double dips You cannot collect any family leave benefits if you are eligible for orreceiving state disability insurance, unemployment compensation orworkers' compensation. Likewise, if you are receiving sick pay from your employer, your familyleave benefits will be reduced by the sick leave wages. If an employee is receiving 55 percent of his or her wages as familyleave benefit, the employer may pay the remaining 45 percent, but theemployee cannot receive more than 100 percent of normal pay. Employers can require workers to use up to two weeks of accrued vacationtime before qualifying for family leave benefits, but they cannotrequire the workers to use sick leave. Who is covered All workers who pay into SDI (through payroll withholding) can claimfamily leave benefits, no matter where or how many hours they work.However, the amount of benefits they receive will be based on wagesreceived -- from one or more employers -- during their base period,which spans the five to 17 months before they file a claim. Eligible employees may collect family leave benefit whether or not theyare covered by federal and state family leave laws. The federal Family Medical Leave Act and the California Family RightsAct allow employees who meet various eligibility requirements and workat sites with 50 or more employees to take up to 12 weeks of unpaidleave every 12 months to care for themselves or a family member withoutlosing their jobs. Workers at smaller companies are not protected bythose laws. If you work for a company that has 15 employees and take time off tocare for a sick father, you could lose your job. However, you will stillbe eligible to receive family leave benefits as long as you had earningsin your base period, says Schroeder. "Paid family leave is a misnomer. It doesn't create any new leaverights. It's just a wage-replacement program," says Case. Documentation To submit a claim, you must fill out an original Form DE 2501F and sendit to the state Employee Development Department. You cannot photocopy ordownload the form from the Internet because the original is encoded withtracking technology. To get a claim form, call 1-877-238-4373. Your employer is not requiredto provide claim forms and will not be involved in claims handling. Thedepartment, however, will ask your employer if you are receiving wages. You must submit a doctor's certificate if you are claiming benefits tocare for a family member, but not for bonding. The department may deny benefits to an employee if someone else isready, willing and able to take care of a family member, Case say. For example, if Mom is sick but Dad can take care of her, you may notget paid. "If a doctor says Mom needs round-the-clock care, that's threepeople pulling eight-hour shifts," Case says. But if the doctor says Momneeds only eight hours of care each day, only one person can claimbenefits. The department may be able to track whether multiple people are claimingbenefits to care for the same person at the same time. "It's a check to make sure there is enough money available" for peoplewho truly need and deserve it, says Case. What is the cost? The department estimates that paid family leave will cost $300 millionto $400 million a year and that it can be financed by the new familyleave tax alone. The state Chamber of Commerce predicts the cost will bemuch higher. That mandatory family leave tax is 0.08 percent of wages, with a maximumcontribution of $55.06 this year and $63.53 next year. Between Jan. 1 and May 2, the tax brought in $129.3 million, accordingto the department. The family leave tax is being poured into the general state disabilityinsurance fund, which can be used to pay family leave as well as regularstate disability benefits. Regular state disability insurance taxes werealso increased this year. After 2005, the state can change the family leave tax if necessary. For more information, go to www.edd.ca.gov and click on Paid FamilyLeave. Net Worth runs Tuesdays, Thursdays and Sundays. E-mail Kathleen Penderat kpender@.... 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