Quick Hits

• The Maryland General Assembly passed legislation delaying the implementation of the paid family and medical leave insurance (FAMLI) program, with contributions starting on January 1, 2027, and benefits beginning by January 3, 2028.
• The Employment and Insurance Equality for Service Members Act would expand employment protections to include all uniformed services and reserve components, effective October 1, 2025.
• Legislation amending the Parental Leave Act to clarify that employers covered by the federal Family and Medical Leave Act are excluded from the definition of “employer,” effective October 1, 2025, passed the General Assembly.
• Maryland Governor Wes Moore is not expected to veto the bills.

All of these bills have been sent to Governor Wes Moore, and he can sign them into law, veto them, or allow them to become law without his signature. Vetoes are not expected on any of these bills, however.

FAMLI Program—Revisions, House Bill (HB) 102

As most employers in Maryland know, in 2022, the General Assembly passed a law, over then-Governor Larry Hogan’s veto, that set up a paid family and medical leave insurance program (FAMLI). The program will apply to all employers with employees in Maryland. It will provide eligible employees with twelve weeks of paid family and medical leave, with the possibility of an additional twelve weeks of paid parental leave (for a possible total of twenty-four weeks of paid leave). We discussed the detailed requirements of the law in our article, Maryland’s FAMLI Program, Part I: An Overview of the Law.

This $2 billion program will be administered by the state and funded by contributions from employers and employees. Contributions were originally set to begin October 1, 2023, with benefits starting January 1, 2025. The Maryland Department of Labor (MDOL) was directed to issue regulations to implement the provisions of the law.

Setting up the FAMLI program has been challenging, and the General Assembly passed legislation to delay implementation, first in 2023, then again in 2024, and yet again this year. Under the most recent delay, contributions from employers and employees to fund the program will begin January 1, 2027, and benefits will begin at some point thereafter, but no later than (and most likely) January 3, 2028.

Other important dates were also changed. The initial contribution rate will now be set by the secretary of labor on or before May 1, 2026. Thereafter, the secretary will set the rate by November 1 each year, to take effect on the following January 1.

The legislation also proposes a new definition: “Anchor Date,” meaning the earlier of when an application for benefits is complete or when FAMLI leave begins. The wage rate for the employee will then be based on the highest of the previous four calendar quarters immediately preceding the anchor date.

Finally, the legislation also provides for a possible annual increase in the weekly benefit amount tied to the Consumer Price Index.

One additional note: The MDOL has engaged in an extensive regulatory process over the past several years, and it finally released proposed regulations in parts last fall and earlier this year. We reviewed the proposed regulations in our articles, “Maryland’s FAMLI Program, Part II: The Proposed Regulations” and “Maryland’s FAMLI Program, Part III: Claims and Dispute Resolution Proposed Regulations.” However, those regulations have now been removed from their website in light of the implementation delay. It is unclear what the MDOL is planning to do with the proposed regulations.

Once signed by the governor or approved without his signature, the law will take effect on June 1, 2025.

Employment and Insurance Equality for Service Members Act, HB 895/Senate Bill (SB) 279

Among other things, this legislation expands employment protections for military members from just the U.S. Armed Forces and National Guard and Reserve to include all uniformed services and reserve components. This means that, in addition to the Army, Navy, Air Force, Marine Corps, Space Force, and Coast Guard, the employment protections under Maryland law now also apply to the National Oceanic and Atmospheric Administration and the Public Health Service.

The affected employment protections under Maryland law are the following:

• Permissible hiring preferences for eligible veterans (meaning one who received an honorable discharge or certificate of satisfactory completion of uniformed service), as well as the spouse of an eligible veteran who has a service-connected disability, the surviving spouse of a deceased eligible veteran, and the spouse of a full-time active member of the uniformed services.
• Leave on the day that the employee’s spouse, (step)parent, (step)child, or sibling is leaving for, or returning from, active duty outside the United States as a member of the uniformed services. Notably, employees are only eligible for this leave right if they have a year of service with the employer and have worked 1,250 hours in the twelve-month period prior to the leave.
• Once FAMLI finally takes effect, employees will (eventually) be able to receive FAMLI leave for certain family military leave reasons: to care for an injured or ill member of the uniformed services who is next of kin, or for certain qualifying exigency reasons related to the active duty of a member of the uniformed services.

When enacted, this law will take effect on October 1, 2025.

Parental Leave Act—Definition of ‘Employer,’ SB 785

Under the Parental Leave Act, employers with fifteen to forty-nine employees in Maryland must provide up to six weeks of unpaid leave for purposes of childbirth, adoption, or foster care placement. In order to be eligible for this leave, the employee must have been employed with the employer for at least twelve months and have worked at least 1,250 hours in the twelve-month period looking back from the date that leave is requested. This legislation clarifies that the definition of “employer” does not include those who are covered by the federal Family and Medical Leave Act (which applies to employers with fifty or more employees anywhere) in the current year.

This amendment will take effect on October 1, 2025.