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Paid Family Leave
Paid Family Leave Defined: PFL is a state-sponsored insurance program within the SDI program. PFL covers employees at organizations of any size. PFL provides employees with partial wage replacement for up to six weeks in any 12-month period while absent from work to care for a seriously ill or injured family member or bonding with a minor child within one year of the child’s birth or placement in connection with foster care or adoption. ​​​​​Like SDI, Paid Family Leave (PFL) does not create the right to a leave of absence. PFL does not require you to create a leave of absence policy or guarantee reinstatement rights other than those already mandated by law. If you withhold SDI contributions from employees’ paychecks, you are also withholding for PFL. As with SDI, PFL is administered by the EDD, and employees apply directly to the EDD for benefits. The EDD is also responsible for the process of confirming if the absence qualifies for benefits. The EDD can require medical and other documentation in support of the claim. State law requires an employee poster, included in the California and Federal Employment Notices Poster, and an information brochure to be given to each employee upon hire and when leaving work for a covered reason. An employee who is entitled to a leave of absence to care for a family member or bond with a child under the FMLA and the California Family Rights Act (CFRA) can receive PFL benefits while on FMLA and/or CFRA.
PFL Qualifying Events: To be eligible for PFL benefits, the employee must need leave to:
  • Care for a seriously ill family member 
  • Bond with the employee’s new child, the new child of the employee’s spouse or domestic partner or a child in connection with the adoption or foster care placement of the child with the employee or the employee’s spouse or domestic partner
  • A “seriously ill” family member includes a parent, spouse, child or domestic partner.
  • Beginning July 1, 2014, a “family member” also includes a grandparent, grandchild, sibling or parent-in-law.

Determining Eligibility for PFL: There is a seven-day waiting period before PFL benefits begin. If a claim for PFL is filed following a pregnancy-related SDI claim, there is no seven-day waiting period. The seven-day waiting period need not be taken seven days in a row. For example, if care was provided one day per week, the seven-day waiting period would be served over a seven-week period. Benefits would be payable after the seven days were served and all other eligibility requirements met. Eligible employees must:
  • Be covered by SDI or a voluntary plan in lieu of SDI and have earned at least $300 from which deductions were withheld
  • Complete all claim forms
  • Supply medical information to support their claim
  • Provide required documentation if leave is to bond with a new child
  • Use up to two weeks of paid vacation if you require it

Benefits are payable for any day in which the employee is unable to perform his/her regular customary work due to a covered absence.
Benefits are available for any day that warrants the participation of the employee, including providing psychological comfort and arranging third-party care for the family member, as well as directly providing or participating in the medical care.

Determining Ineligibility for PFL: An individual cannot receive PFL payments if he/she is:
  • Receiving SDI benefits
  • Receiving unemployment or workers’ compensation benefits
  • Not working or looking for work
  • Not suffering a loss of wages (receiving disability benefits, including SDI, paid sick leave or PTO)
  • Unable to prove that there is a need for care through documentation by the ill individual’s health care provider
  • In custody as a result of a conviction for a crime
  • Employees are also not eligible for any day that another family member is able and available for the same period of time that the individual is providing the required care.

Taxing PFL Benefits: The IRS ruled that benefits received under California’s PFL program are taxable for federal income tax purposes. The benefits are not subject to California income tax.
Defining PFL-Related Terms: The following are important definitions related to PFL:
  • “Child” includes a biological, adopted or foster son or daughter, a stepson or stepdaughter, a legal ward, a son or daughter of a domestic partner or the person to whom the employee stands in loco parentis.
  • “Domestic partner” is one who qualifies under section 297 of the Family Code.
  • “Parent” includes a biological, foster or adoptive parent, a stepparent, a legal guardian or other person who stood in loco parentis to the employee when the employee was a child.
  • “Serious health condition” means an illness, injury, impairment or physical or mental condition that involves inpatient care in a hospital, hospice or residential health care facility or continuing treatment or continuing supervision by a health care provider.
  • “Spouse” is a partner to a lawful marriage.

Beginning July 1, 2014, the following additional definitions related to who is a family member for PFL purposes are added:
  • “Grandchild” means a child of the employee's child.
  • “Grandparent” means a parent of the employee's parent.
  • “Parent-in-law” means the parent of a spouse or domestic partner.
  • “Sibling” means a person related to another person by blood, adoption or affinity through a common or legal or biological parent.

PFL and Other Wages: You can require the use of up to two weeks of vacation time when an employee applies for PFL benefits. The first week of vacation pay would be available for the seven-day waiting period before PFL benefits begin. Because PFL benefits do not totally replace an employee’s earnings, you can require or allow the use of paid sick leave, PTO and/or vacation to supplement PFL payments. You can require the employee to use other paid time off to supplement PFL benefits if you maintain a policy that requires the use of other paid time off to supplement benefit payments and the paid time off applies to this type of absence.

If an employer wants to coordinate PFL with other wages, the employer must remember that it is the responsibility of the employer and the employee to ensure that the employee is not receiving more than 100 percent of his/her normal gross wages when receiving coordinated or integrated wages from the employer. For purposes of SDI and PFL, vacation is not considered a form of wages. The most common type of payments that are considered wages for SDI or PFL purposes are sick leave, bereavement pay, back pay and earnings.

Funding PFL: The PFL program is funded entirely through increased employee contributions to the SDI fund. The Legislature provided for the addition of these benefits to voluntary plans permitted under section 3254 of the Unemployment Insurance Code.
Integration and Coordination of PFL With Other Benefits: Employees who meet all of the eligibility requirements can be paid for up to six weeks in a 12-month period. The weekly benefit amount is based on the employee’s wages in the highest quarter of the employee’s base period. Weekly benefits range from $50 to a maximum of $1,075. To qualify for the maximum weekly benefit amount ($1,075), an individual must earn at least $25,385.46 in a calendar quarter during the base period. PFL benefits are not paid for leave for the employee’s own disability. However, if the employee wants to take time off for baby bonding or to care for a seriously ill family member, he/she can receive PFL benefits during the time that is also designated FMLA or CFRA. If an employee takes up to 12 weeks of FMLA/CFRA to care for a seriously ill parent, spouse or dependent child, or up to 26 weeks to care for an ill or injured service member, the employee may be eligible for PFL benefits for up to six weeks in a 12-month period.

PFL and PDL: An employee disabled by pregnancy is eligible for SDI benefits, but not eligible for PFL benefits. However, after she is no longer disabled by the pregnancy (and her SDI benefits cease), she can apply for PFL benefits during the time she takes off to bond with her new child.

PFL and Family Medical Leave: PFL benefits are payable only when an individual is caring for a family member or bonding with a new child. An eligible employee could receive PFL payments for a maximum of six weeks in a 12-month period while on FMLA/CFRA leave to:
  • Care for a seriously ill spouse, parent, dependent child or domestic partner.
  • Bond with a new child of the employee, his/her spouse or domestic partner or one placed with the employee for adoption or foster care.
  • Beginning July 1, 2014, PFL benefits are available to care for family members not covered by FMLA/CFRA (grandparent, grandchild, sibling or parent-in-law).