Employers Required to Prepare and Act Now

    The Maryland Department of Labor is launching a new Paid Family and Medical Leave program (MD PFML) for all employees working in the State of Maryland. Although benefit payments to eligible employees will begin July 1, 2026, employers must decide whether they want to go through the MD State insurance program or select a private insurance plan beginning in May of 2025. If an employer selects to participate in the state program, deductions for the both the employer and employees will need to begin in July of 2025. If a private program is selected, deductions and contributions will not need to be submitted to the State and can be deferred until July of 2026. However, a Declaration of Intent (DOI) must be submitted to the FAMLI Division of Maryland’s Department of Labor starting in May of 2025.The following information provides an overview on the requirements under the MD PFML program. FosterThomas is here to help you prepare and support you in making the right decision for your business that will provide the best experience for your organization and your employees. Please feel free to contact us with any questions or concerns. Current clients will be contacted directly by your FosterThomas representative.
    Maryland Family and Medical Leave Insurance (FAMLI) Program Background
    Beginning July 2026 Maryland workers will receive job protection and be able to take paid time away from work to care for themselves or a family member for up to 12 weeks. FAMLI is an insurance program and employees may be eligible to receive up to 90% of their wages, subject to limitations.  For 2026, the maximum weekly benefit will be $1,000 per week, and the minimum weekly benefit will be $50 per week.  Under this program employers and workers will make contributions into a fund administered by the State. Alternatively, an employer may apply to use a private commercial or self-insured plan. When a worker needs to take leave, either the State or the private plan will pay the worker a portion of their salary.    

    MD PFMI Fact Sheet 

    MD DOL FMLI Web Link
    Key Dates
    May 1, 2025 – First date employers may apply for an exemption from the state plan.
    July 1, 2025 – Payroll deductions and employer and employee contributions to the state program begins unless a private plan has been declared and accepted. 
    July 1, 2026 – Benefit payments will begin for both the state and private plan programs.

    Private Insurance or State Program Considerations, your options are: 

    Choose the state program;       

    – OR –

    Choose to offer a private plan.  Private plans may be fully insured or self-insured (minimum of 50+ employees).  One of FosterThomas’ main carriers will be providing a state-approved fully insured private plan and we can obtain a preliminary quote now for you to weigh your options.

    The Private, MD PFML plans will be a fully insured, state-approved plan that will meet or exceed the statutory requirements for a private plan and be supported by digital capabilities to help make administration easier. 

    Payment and Contributions 
    Contributions to the state program begin July 1, 2025. The MD PFML contribution rate will be 0.90% of wages capped at the Social Security wage base. Employers may take employee payroll deductions up to 50% of the state rate.

    Private plans will be individually underwritten. However, the employee contributions and employer premiums will not be required until 2026 when the policy and plan is in effect.  

    Private Insurance Declaration of Intent (DOI)
    The MD FMLI Division will open a DOI process in May of 2025. At that time, employers will be able to submit a DOI to notify the Division that they intend to offer a private plan. If an employer’s DOI is accepted, they will not contribute to the State Plan for the quarters the DOI is in effect. If the employer does not ultimately offer a private plan, they will be responsible for all contributions that would have been due, in addition to interest charges.    

    DOI / Private Insurance Fact Sheet

    Private Insurance Benefits / Considerations
    Delayed funding.  You will not have to pre-fund with the state starting in July 2025. Contributions will not begin until the policy is in effect, after July 2026. Billing is quarterly in arrears.

    Private FMLI is generally more cost-effective than the state-run FMLI.  The Private FMLI rates will also have a two-year guarantee.  State plans can increase.

    Your staff and employees will receive better administration, service, and claims adjudication through private carrier and your FosterThomas support team. 

    Your Next Steps

    To prepare for the state program, you should identify all your employees working in Maryland who are impacted by these new laws, evaluate the cost impacts, and determine your coverage options – private or state. FosterThomas can obtain a private quote for you. Again, please feel free to contact us with any questions or concerns.  Current clients will be contacted directly by your FosterThomas representative to discuss and review your options in greater detail.