Colorado’s Family and Medical Leave Insurance program portal is now open for businesses.

The program is a requirement for all Colorado employers to contribute to beginning Jan. 1.

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Voters approved Proposition 18 in 2020, which created the new paid family and medical leave insurance program for Colorado. It’s administered by the Colorado Department of Labor and Employment. It requires both employers and employees in Colorado to pay a payroll premium to finance the paid family and medical leave insurance benefits beginning Jan. 1. It allows eligible employees up to 12 weeks of paid family and medical leave. It also created job protections for employees who take paid medical and family leave.

Payroll deductions begin in 2023, but benefits are not available until 2024. There are several reasons why an employee could be pulled away from the workplace, according to FAMLI Division Director Tracy Marshall, including health conditions, health conditions of a loved one, or intimate partner violence or assault.

However, Colorado’s new state paid leave does not give 100% wage replacement – so adding in current plans through insurance coverage can also add benefit. Colorado will be the ninth state to roll this sort of program out once it goes live, according to Marshall.

The benefit for employers through the state program is that while employees are on leave, they are going to be getting paid by the state rather than the employer if they participate in the basic program. Employers can have cost savings to bring on a temporary worker, or to pay their current employees to work additional hours or take on more responsibilities during those 12 to 16 weeks.

“It really does offer that financial support for individuals, it offers greater care giving opportunities for people,” Marshall said. “One of the interesting facts that I know we’ve heard about fairly recently is that they’ve actually seen decreases in things like pediatric head trauma. It’s fascinating that the research that’s out there about how access to paid leave can really impact the family as a whole.”

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This program requires that employers notify employees of payroll deductions by Jan. 1, 2023. The first payment employers need to make is not due until April 30, 2023, and there is a 30-day grace period for those who are considered late. Employers or third-party administrators will register at FAMLI.colorado.gov and must do so before the first quarterly premium payment is due, according to a news release. Premiums are split, with 0.45% paid by the employer and 0.45% paid by the employee.

Employers with nine or fewer employees are not required to cover the employer side of the premiums, and only need to contribute the 0.45% employee part. This program allows workers to get up to 12 weeks of payment, or 16 weeks with childbirth complications, on a sliding scale. Private employers are still allowed to use a private insurance plan that adds to these offerings.

There was some controversy around Proposition 118 before it was passed in 2020. The city of Aurora voted to pull out of the program, and the city of Denver voted to create it’s own version of the program that only allows eight weeks of paid family leave for employees through a system called the “Care Bank.” Chronos Builders, LLC, a home builder on the Western Slope, got into a legal battle over the proposition. 

Angela Hildebrand, president of operations for Autopaychecks HCM, said in the more rural area of western Colorado, where they are located, this change was a shock to businesses.

“We’re western Colorado, we’re pretty rural, [we have] a little bit different philosophy in running a business than in Boulder and some of the other areas that I think that population helped pass the bill to law,” Hildebrand said. “So knowing rural Colorado and the conservative nature of the businesses, I knew it was going to be a shock.”

Despite the fights put up by some, others are looking forward to this addition. Lindsey Vigoda, the Colorado director for the Small Business Majority, said small businesses are struggling with hiring and recruiting post-pandemic as they try to compete with liveable wages and benefits. This program can offer a benefit package that can put them at an advantage to larger counterparts, Vigoda said.

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According to polling from 2019, 64% of small businesses support some form of a family and medical leave insurance program from the state. 

“I think there’s always going to be a learning curve, wether its with this program, with secure savings, or any healthcare benefit you bring into a business,” Vigoda said. “But overall I think that the benefits outweigh the disadvantage.”