The Colorado Department of Labor and Employment is preparing to initiate collection of a 0.9% payroll tax from employers in January 2023 as part of the Family and Medical Leave Insurance Program (FAMLI).
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Colorado voters approved the program as a ballot measure in 2020, which mandates 12 weeks of annual paid family and medical leave for all employees in the state who make a minimum of $2,500 per year.
Starting next year, state law requires half of the payroll tax to be paid by employers and the remaining half to be paid by employees. Employees also have the option to pay more than half of their share.
An individual with $50,000 in annual income can expect to pay a maximum of $225 per year or $4.32 per week.
Employees can begin taking leave on January 1st, 2024, for any of the following covered circumstances:
- Caring for a new child, including adopted and fostered children
- Caring for themselves, if they have a serious health condition
- Caring for a family member with a serious health condition
- Making arrangements for a family member’s military deployment
- Addressing the immediate safety needs and impact of domestic violence and/or sexual assault
An individual on paid leave can receive up to 90% of their average weekly wage if it totals 50% or less of the state’s average weekly wage. Should that portion exceed half of the state average weekly wage, the individual can receive 50% of their weekly wage. The maximum weekly benefit will be capped at $1,100 when the program begins in 2024.
A study published in the American Journal of Preventive Medicine in August found that states with paid sick leave requirements had lower rates of death among working-age adults. Researchers projected that mandating a 40-hour annual paid sick leave could lead to a potential 5% drop in working-age mortality.