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July 31, 2019

New guidance on mass FMLA payroll contributions and wage withholdings

George Thompson

On July 26th Department of Paid Family Medical Leave (DPFML) released the following employer guidance that: (1.) concludes that withholdings will be based on the date wages are paid (not earned) and (2.) effectively moves the date that an employer has to remit contributions for an employer, who is enrolled in the state program, from on or after October 1, 2019 to January 31, 2019. 

From the DPFML
October 1 marks the beginning of the first quarter of payroll and wage withholdings. These withholdings, and in some cases employer payments, will be remitted to the Department of Revenue 30 days following the conclusion of each calendar quarter.  This timeframe is the same as the schedule for making Unemployment Contributions. By January 31, 2020, employers must complete quarterly filings and submit contributions through MassTaxConnect for the previous calendar quarter (October - December).  Previously, the interpretation was that contributions would be due for services performed by an employee on or after October 1. 

As a result of the comments received from the employer and business community, the DFML has reevaluated this interpretation. We have now determined that withholdings will be based on the date that wages are paid (commonly referred to as ‘employee pay check date’) irrespective of the date the employee performed those services.  For example, if an employee receives a paycheck on or after October 1, 2019 where some of those wages were for services performed prior to October 1, 2019, then all of the wages in the paycheck will be subject to contributions. 

Please refer to the website for more detailed information on this change in policy.