Although there are common elements to the many PFL regulations, there are also differences in the way each state designs its plan and coordinates it with other leave types. Here’s what you need to know about PFL and state disability in New Jersey.
For guidance on regulation changes due to the evolving COVID-19 situation,
please click here. (PDF)
Paid Family Leave
On February 19, 2019, Governor Murphy signed legislation to expansively amend New Jersey's Family Leave Insurance, Temporary Disability Insurance and Family Leave Act programs. The below FAQs reflect these changes as well as 2020 annual updates.
The (FLI) program is a paid family leave program that provides up to twelve weeks of wage reimbursement to:
- Bond with a new child within 12 months of birth or placement via adoption or foster care
- Care for a seriously ill family member
- Assist a family member who is a victim of domestic or sexual violence
Family member refers to a child, spouse, domestic partner, civil union partner, parent, siblings, grandparents, grandchildren, parents-in-law, and others related by blood or relationship equivalent to a family relationship.
Since July of 2009, FLI has been available to NJ employees.
Any employee working in New Jersey that meets one of the two following requirements:
- Worked at least 20 weeks during the 52 weeks leading up to the claim, making at least $220 per week, or
- Earned at least $11,000 during the 52 weeks leading up to the claim
Employees are required to provide notice unless the employee needs the time unexpectedly or the leave changes due to unpredictable reasons. To bond with a new child, an employee is required to give 30 days' notice and provide reasonable advance notice for care of a seriously ill family member.
Employers are automatically enrolled with the State, unless they received prior approval for a private plan through an approved insurance carrier or decide to self-fund their plan. A private plan cannot be more restrictive, offer lower benefits or require more employee contributions than prescribed by the State.
Lincoln is an approved carrier in New Jersey to provide Temporary Disability Benefit (TDB) coverage; Lincoln does not offer a self-funded option and does not administer the FLI program.
This benefit program is 100% employee-funded by payroll deduction. The state updates deduction rates on an annual basis.
|Employee contribution rate||0.16%||0.28%|
|Employee taxable wage base||$134,900||$138,200|
PFL dedication are taken in a similar manner to Social Security and Medicare deductions.
- 2021 Maximum annual deduction will be $386.96 for each employee that earns an annual wage equal to or greater than the 2021 employee taxable wage base.
- Annual deduction for employees earning less than the 2021 employee taxable wage base will be equivalent to 0.28% of their wages for the year.
2020 was the first year the state enforced a different taxable wage base for employees and employers. This change was introduced to shift more cost to employees given the significant benefit increase effective July 1, 2020. While the employer taxable wage base will remain 28 times the NJ statewide average weekly wage (SAWW), raised to the next higher multiple of $100, the employee taxable wage base will increase to 107 times the SAWW, rounded to the next higher $100.
FLI benefits are subject to federal income tax and to federal rules on reporting income and paying taxes. FLI benefits are not subject to New Jersey state income tax. Employees may choose to have 10% of their benefits withheld for federal income tax. Benefits are reported on a 1099-G tax form.
The 2021 weekly benefits will continue to be 85% of an employee’s average weekly wage up to the maximum of $903. For more of the benefit changes see below:
|Max weekly benefit||$903|
|Intermittent leave allowance||Up to 56 days|
|Benefit duration||12 weeks|
Benefits are not payable for any period during which an employee receives any paid sick leave, vacation time or other leave at full pay from the employer.
Yes. Leave can be taken intermittently during a 12-month period and should be agreed upon between the employer and employee.
In the case of taking intermittent leave for bonding with a child, the employee must take the leave in seven or more day increments.
Effective July 1, 2020, the maximum intermittent FLI leave is increased from 42 days to 56 days.
|2019||2020 (Jan 1 to June 30)||2020 (July 1 and later)|
|Intermittent leave allowance||Up to 42 days||Up to 42 days||Up to 56 days|
Intermittent leave requires 15 days' notice before the leave.
No, the FLI program does not provide job protection. The employee's job may be protected if their leave also qualifies for leave under FMLA or the New Jersey Family Leave Act.
The best source of information for employees and employers, including claim forms and other helpful documentation is the
Department of Labor and Workforce website.
Temporary Disability Benefits
Temporary Disability Insurance provides cash benefits to employees working in New Jersey who experience a non-work related illness, injury, or other disability that prevents them from working. Most employers with employees working in New Jersey are required to have TDI for their employees. Note: this program is also commonly referred to as Temporary Disability Benefits (TDB).
New Jersey employers and employees have been funding a wage replacement insurance program since 1948.
Employees who work 20 calendar weeks in the state and have earned a minimum of $172 or have earned $8,600 in the base year (base year = 52 weeks prior to date of disability) are eligible.
Employers can choose to provide coverage through a private plan, which must first be approved by the Division of Temporary Disability Insurance. Carriers commonly handle the application process with the Division of TDI on an employer’s behalf.
Private plans must have, at minimum, the same or better benefit amounts, eligibility requirements and duration of payments as the state plan. A private plan cannot cost the employee more than the state plan does. Private plan disability benefits may be subject to Social Security (FICA) and federal income taxes.
Both employers with employees working in the state and the employees themselves contribute to the cost of the temporary disability program. For employees’ contributions, deductions are taken out of their paychecks.
|Employee contribution rate||0.17%||0.26%|
|Employer taxable wage base*||$34,000||$35,300|
|Employee taxable wage base**||$34,000||$134,900|
|Maximum employee deduction||$58.48||$350.74|
*There is currently a single taxable wage base used to determine employee and employer contributions under the state plan.
**Starting in 2020 there will be a significantly higher taxable wage base for employees to account for 2020 benefit increases. Employees will now bear a much larger share of costs (whether under the state or a private plan.
Note: The state of New Jersey passed legislation (A-3975) on February 19, 2019, to amend a number of mandated programs, including TDI. The taxable wage base will be increasing significantly as of January 1, 2020. Further detail will be forthcoming as the state issues regulations.
The maximum benefit duration is the lesser of up to 26 weeks, or until benefits equal to one-third of an employee’s total wages earned during the base year. The base year is the 52 weeks immediately before the week in which the disability began.
|2019||2020( Jan 1 to Jun 30)||2020( July 1 to later)|
|Waiting period||7-day wait period (removed 2/4/19)||0-day||0-day|
|Max weekly Benefit||$650||$667||$881|
|Intermittent leave allowance||Up to 42 days||Up to 42 days||Up to 56 days|
|Benefit duration||6 weeks||6 weeks||12 weeks|
Note: Starting July 1, 2020, the maximum weekly benefit amount will be increasing approximately 30% as stipulated under amendment A-3975. Further detail will be forthcoming as the state issues regulations.
The same proportion of premium funded by the employer is used to determine the portion of the disability benefits that are subject to federal income taxes and the Federal Insurance Contributions Act (FICA). FICA taxes will be for six calendar months following the last calendar month in which the employee worked.
When an employee’s premium payments for disability benefits are paid with after-tax dollars, their contributions are not subject to federal income or FICA taxes. However, if the employee pays all or a portion of the premium on a pre-tax basis, then the entire benefit is subject to federal income tax and FICA.
Although NJ TDI doesn’t require an employer to hold a job for someone receiving benefits, the employee may have job protection rights under the federal Family and Medical Leave Act (FMLA).