Bill Text - HB628 (2018)

Relative to a family and medical leave insurance program.


Revision: April 4, 2018, 8:46 a.m.

HB 628-FN - AS AMENDED BY THE HOUSE

 

9Jan2018... 2481h

8Feb2018... 0225h

2017 SESSION

17-0016

06/10

 

HOUSE BILL 628-FN

 

AN ACT relative to a family and medical leave insurance program.

 

SPONSORS: Rep. Gile, Merr. 27; Rep. Wallner, Merr. 10; Rep. LeBrun, Hills. 32; Rep. Rosenwald, Hills. 30; Rep. Fothergill, Coos 1; Rep. Gargasz, Hills. 27; Rep. McMahon, Rock. 7; Rep. Cilley, Straf. 4; Rep. King, Hills. 33; Sen. Woodburn, Dist 1; Sen. Fuller Clark, Dist 21; Sen. Feltes, Dist 15

 

COMMITTEE: Labor, Industrial and Rehabilitative Services

 

─────────────────────────────────────────────────────────────────

 

ANALYSIS

 

This bill establishes a system of paid family and medical leave insurance.

 

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -

 

Explanation: Matter added to current law appears in bold italics.

Matter removed from current law appears [in brackets and struckthrough.]

Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.

 

 

9Jan2018... 2481h

8Feb2018... 0225h 17-0016

06/10

 

STATE OF NEW HAMPSHIRE

 

In the Year of Our Lord Two Thousand Seventeen

 

AN ACT relative to a family and medical leave insurance program.

 

Be it Enacted by the Senate and House of Representatives in General Court convened:

 

1  New Chapter; Family and Medical Leave Insurance.  Amend RSA by inserting after chapter 282-A the following new chapter:

CHAPTER 282-B

FAMILY AND MEDICAL LEAVE INSURANCE

282-B:1  Findings.  The general court finds that family and medical leave insurance will help New Hampshire attract and retain workers, including younger workers, will enable parents to bond with biological, adopted, or foster children, will help meet the needs of an aging population, will advance the health of New Hampshire's workforce and workplace stability, and will enhance worker retention and productivity.  The general court therefore finds that it is in the public interest to establish a system of family and medical leave insurance (FMLI) with benefits to be provided to qualified workers on a limited basis.

282-B:2  Definitions.  In this chapter:

I.  "Benefit year" means the 12-month period beginning with the first day of the calendar week in which the individual next files an application for FMLI benefits after the expiration of the individual's last preceding application year.

II.  "Calendar quarter" has the same meaning as in RSA 282-A5.

III.  "Child" has the same meaning as "son or daughter" in 29 U.S.C. section 2611(12).

IV.  "Commissioner" means the commissioner of the department of employment security.

V.  "Department" means the department of employment security.

VI.  "Employer" has the same definition as relevant provisions of RSA 282-A:8., except as provided in RSA 282-A:9.

VII.  "Employment" means wages paid for services by an employer that is covered by this chapter.

VIII.  “Family member” means a “child”, as defined in RSA 282-B:2, III, a biological, adoptive or foster parent, stepparent, or legal guardian of the child or the child’s spouse or domestic partner, a biological, adoptive, or foster grandparent or  step grandparent, or a spouse or domestic partner under RSA 457.

IX.  "Family and medical leave" means leave from work:

(a)  Because of the birth of a child of the employee, within the past 12 months; or

(b)  Because of the placement of a child with the employee for adoption or fostering, within the past 12 months; or

(c)  Because of a serious health condition of a family member; or

(d)  Because of a serious health condition of the employee that isn't related to employment.

X.  "FMLI" means family and medical leave insurance.

XI.  "Federal Family and Medical Leave Act" means the federal Family and Medical Leave Act of 1993, 29 U.S.C. chapter 28.

XII.  "Serious health condition" means any illness covered by the federal family and medical leave act including treatment for addiction as prescribed by a treating clinician, consistent with American Society of Addiction Medicine criteria, as well as treatment for a mental health condition, consistent with American Psychiatric Association criteria.

XIII.  "Fund" means the family and medical leave insurance fund as described in RSA 282-B:4.

282-B:3  Employer Applicability.

I.  This chapter applies to all nongovernmental employers, provided that any employer participating in a self-insured plan or who is self-insured may opt out of this chapter upon certification by the commissioner or authorized representative that the employer provides an equivalent benefit for its employees.  The state or its political subdivisions may opt into this chapter upon certification by the commissioner or authorized representative that this chapter's insurance benefits are at least equivalent to the benefits provided under the collective bargaining agreement, provided the applicable bargaining unit has first ratified this option.

II.  All employers subject to this chapter shall remit FMLI premium payments on a calendar quarter basis.  These quarterly insurance premium payments shall amount to 0.67 percent of wages per employee per week for each week of the preceding quarter.  Employers may withhold or divert no greater than 0.67 percent of wages per week per employee to satisfy this paragraph, provided that such employers provide employees, before employment commences, a department approved information sheet containing conspicuous language explaining the costs and benefits of the insurance and indicating that employees are able to affirmatively opt-out of the insurance by downloading a form from the department and that such form, if the employee chooses to opt-out, shall be notarized and submitted to the department and the employer before employment commences, and that the employee shall be provided the opportunity to opt in on January 1 of each year.  No employer shall make opting-out of the insurance a condition of employment nor discriminate against an employee in compensation or in terms, conditions, or privileges of employment based on whether or not the employee opts-out of the insurance.

III.  The penalties for falsity by employers shall be in accordance and consistent with RSA 282-A:166.  The process for failing to adequately report shall be in accordance and consistent with RSA 282-A:151-152 and 282-A:166-a, and any resulting appeals shall be processed in accordance and consistent with RSA 282-A:94-98.

282-B:4  Family and Medical Leave Insurance Fund Administration.  The department shall create and administer a family and medical leave insurance fund for deposits of insurance payments paid pursuant to RSA 282-B:3, and accept any other deposit of moneys as authorized by law or by the commissioner or authorized representative.  No FMLI fund moneys shall be co-mingled with unemployment insurance fund moneys.  The department is authorized to withdraw or deduct from the FMLI fund where there are qualifying FMLI benefit payments or for any amounts reasonably necessary to implement and administer the provisions of this chapter.

282-B:5  Employer and Employee Responsibilities.

I.  An employee shall both file an application with the department, including any applicable medical certification or birth certificate, and provide his or her employer with written notice of intent to take a leave of absence at least 30 days before the leave will begin unless the leave was not reasonably foreseeable or the time of the leave changes due to circumstances that were not reasonably foreseeable.  An employee's failure to provide required notice may delay or reduce benefits.

II.  Any employee of an employer covered under the federal Family and Medical Leave Act who takes leave under this chapter shall be restored to the position he or she held in the application period or to an equivalent position by his or her employer.  Employers shall continue to provide health insurance to employees during the leave, but employees remain responsible for any employee-shared costs associated with the health insurance benefits.  Employers shall not retaliate against any employee solely for exercising his or her rights under this chapter.

III.  An employer may require that leave taken under this chapter be taken concurrently or otherwise coordinated with leave allowed under the terms of a collective bargaining agreement or employer policy.  The employer shall give individuals in its employ written notice of this requirement.

282-B:6  Eligibility Process, Calculation and Appeals.

I.  An employee shall be limited up to 6 weeks of FMLI in any one application period.  An employee shall have had premium payments remitted as a percent of his or her wages for at least 6 months to be eligible for benefits and shall have worked in employment resulting in wages in the amount of at least 1,040 multiplied by the applicable minimum wage, in either the “base period” or “alternative base period”, as those terms are defined in RSA  282-A:2.

II.  An employee shall be eligible for FMLI for reasons identified in paragraph I and RSA 282-B:2, IX.

III.  The calculation of weekly FMLI benefits shall be the highest quarter of wages in either the base period or alternate base period as defined in RSA 282-A:2, then divided by 13 and multiplied by 0.6, provided that no such calculation of FMLI benefits shall be less than $125 per week or greater than 0.85 of the average weekly wage in New Hampshire.  The calculation for partial FMLI benefits shall be in a manner consistent with RSA 282-A:14.

IV.  The process for FMLI benefits claims, violations, and any resulting appeals shall be in accordance and consistent with RSA 282-A:42 through RSA 282:68 and RSA 282-A:118.  The standard and process for handling overpayments shall be in accordance and consistent with RSA 282-A:29, RSA 282-A:141-RSA 282-A:156 and RSA 282-A:165.  In addition, an individual shall be disqualified from FMLI benefits beginning with the first day of the calendar week, and continuing for the next 26 weeks, in which the individual has been found to willfully made a false statement or misrepresentation regarding a material fact, or willfully failed to report a material fact, to obtain benefits under this chapter.

285-B:7  Limitations.  Nothing in this chapter shall diminish an employer's obligation to comply with a collective bargaining agreement or employer policy, nor does this chapter, or any decision by the commissioner or authorized representative under this chapter, limit the ability of employers to provide FMLI benefits or benefits beyond what is required by this chapter.

282-B:8  Report and Outreach.  

I.  The department shall make public and provide semi-annual reports to the governor, senate president, speaker of the house of representatives, and the advisory council established pursuant to RSA 282-A:128 involving a summary to include but not be limited to, compliance with this chapter, payments into and out of the fund, fund balance, participation rates including for low wage employees, and retention of employees who received FMLI benefits.

II.  The department shall develop and implement an outreach program to ensure that individuals who may be eligible to receive FMLI benefits under this chapter are made aware of these benefits.  Outreach information shall explain in an easy to understand format, eligibility requirements, the claims process, weekly benefit amounts, maximum benefits available, notice requirements, reinstatement and non-discrimination rights, confidentiality, and coordination of leave under this chapter and other laws, collective bargaining agreements, and employer policies.

282-B:9  Rulemaking.  The commissioner shall adopt rules, pursuant to RSA 541-A,  relative to this chapter.  In adopting rules, the commissioner shall maintain consistency with the rules adopted to implement the federal Family and Medical Leave Act, to the extent such rules are not in conflict with this chapter.

2  Advisory Council.  Amend RSA 282-A:128 to read as follows:

282-A:128  Advisory Council.  There is hereby created within the unemployment compensation bureau an advisory council on unemployment compensation and family medical leave insurance, hereinafter called the advisory council.  The advisory council shall consist of 9 members to be appointed, with the exception of the legislative members, by the governor with the consent and advice of the governor's council.  Three of the appointees of this advisory council shall be persons who, because of their vocations, employment or affiliations, shall be classed as representing the point of view of employers; 3 shall be persons who, because of their vocations, employment or affiliations, shall be classed as representing the point of view of employees; one shall be a senator from the insurance committee appointed by the senate president; one shall be a representative from the labor, industrial and rehabilitative services committee appointed by the speaker of the house; the remaining appointee, who shall be designated as chairman, shall be a person whose training and experience qualify him to deal with the problems of unemployment compensation.  Such advisory council shall meet no later than 45 days after each calendar quarter and aid the commissioner in formulating policies and discussing problems related to the administration of this chapter and RSA 282-B and in assuring impartiality and freedom from political influence in the solution of such problems.  Advisory council meetings shall provide opportunity for public comment.  The advisory council shall quarterly review and evaluate family medical leave insurance and, after 2 years of administration, the commissioner shall assess utilization, finances, and benefit levels and provide the general court with rate adjustment or fiscal recommendations.

3  New Subparagraph; State Treasurer; Application of Receipts.  Amend RSA 6:12, I(b) by inserting after subparagraph (339) the following new subparagraph:

(340)  Moneys deposited in the family and medial leave insurance fund established in RSA 282-B:4.

4  Family and Medical Leave Insurance Program; Funding.  The initial administrative and implementation costs associated with this chapter shall either be a capital appropriation included in the state capital budget of the 2019 legislative session or an appropriation in fiscal year 2020 in the operating budget for the biennium ending June 30, 2021.  Initial administrative and implementation costs shall be reimbursed to the general fund within 10 years.

5  Effective Date.  This act shall take effect January 1, 2019.

 

LBAO

17-0016

Amended 2/23/18

 

HB 628-FN- FISCAL NOTE

AS AMENDED BY THE HOUSE (AMENDMENT #2018-0225h)

 

AN ACT relative to a family and medical leave insurance program.

 

FISCAL IMPACT:      [ X ] State              [    ] County               [    ] Local              [    ] None

 

 

 

Estimated Increase / (Decrease)

STATE:

FY 2019

FY 2020

FY 2021

FY 2022

   Appropriation

$0

Indeterminable

Indeterminable

$0

   Revenue

$0

$0

$0

Indeterminable Increase

   Expenditures

Indeterminable Increase

Indeterminable Increase

Indeterminable Increase

Indeterminable Increase

Funding Source:

  [ X ] General            [    ] Education            [    ] Highway           [ X ] Other

 

 

 

 

 

METHODOLOGY:

This bill creates a family and medical leave insurance program (FMLI) to be administered by the Department of Employment Security.  The program would apply to non-governmental employers but allow an employer to opt out if they are able to demonstrate they provide an equivalent insurance plan for employees.  The state and political subdivisions would be allowed to opt into the program but would be required to show benefits available in the program are at least equivalent to the benefits provided under their existing plan.  Initial administrative and implementation costs would be funded with a capital or operating budget appropriation in the FY 2019 legislative session.  

 

The Department of Employment Security has no information on which, if any, governmental entities would opt into the program, whether there would be any cost or benefit to doing so, or whether such action would be revenue neutral.  The bill would allow employees the ability to opt-out before employment commences.  An employee choosing to opt-out would have the opportunity to opt-in each January 1st.  It is not possible to estimate with any degree of certainty how many employees would choose to opt-out of the program or how many employees electing to participate in the insurance program would utilize the benefits available under the program.  The proposed benefit would be funded through 0.67 percent of participating employee wages withheld per week per employee.  Participating and qualifying employees would then be able to apply for up to 6 weeks of leave during any 12 month period. The weekly benefit is calculated at 60% of the employee’s average weekly wage during the highest earning quarter of the employee’s base period as defined in the legislation but no less than $125 per week, and no higher than 85% of the average weekly wage in New Hampshire.

 

The Department of Employment Security will be responsible for the creation and administration of the FMLI program.  The Department would accept and manage employer deposits into the FMLI Fund, adjudicate and pay benefits from the fund to eligible individuals and provide outreach and awareness regarding the FMLI program.  The Department estimates it would take 24 months to develop an information technology system to be able to accept and account for the revenue: take claims for benefits; adjudicate claims for benefits; and process appeals.  The project would start with the development of the enhancements to the current tax system in order to be able to accept and account for revenue.  This is expected to take 24 months and involve existing program staff from the Department of Employment Security and existing as well as new staff from the Department of Information Technology (DoIT).

 

A new benefit application would require 24 months to develop and launch and would be accomplished by contracting with an IT vendor.  The services would be procured through a competitive bid process and development could only begin after the contract is finalized.  The Department estimates it could take up to 6 months from the effective date of the bill for development of the benefit application to begin.  Therefore, the Department estimates the development period will be 30 months.  The benefit application would be designed by existing department staff working in collaboration with the IT vendor.  Once complete, the program would be administered by existing and new department staff.  The benefit application itself would be maintained by the IT vendor.  While the bill authorizes the Department to withdraw or deduct from the FMLI fund amounts reasonably necessary to implement and administer the FMLI program, the initial system development and staffing costs would be incurred before the program begins operation.  This would require an alternative funding source for program development and initial program launch.

 

The program would include a new public facing online application for filing for benefits and an internal staff view for adjudicating eligibility and electronic payment of benefits. The benefit application would include all of the conveniences currently provided to individuals for unemployment benefits.  The annual maintenance cost for the benefit payment application is estimated at $2,000,000 and would paid to the outside IT vendor chosen to administer and maintain the application.  This is consistent with the industry standard for maintenance costs of 20% of development costs.  Additional hardware to support the new benefit and revenue applications and database would be a one-time cost of $400,000.  The Department anticipates the new revenue application would be developed and maintained by state DoIT employees. The application would include all the same conveniences currently provided to employers for unemployment insurance taxes.

 

The staff costs include the cost to develop, test, launch and maintain the revenue application, costs to test and launch the benefit application, and ongoing costs for program maintenance after development is complete.  The majority of the staffing costs in FY 2019 and FY 2020 will be for existing and new DoIT staff working with Department of Employment Security staff to develop the revenue application.  In FY 2021 the staff costs will transition to from development costs to program costs.  

 

The Department estimates the following staff and costs to develop, test, and launch the program:

 

Program Development

Maintenance

 

FY 2019

FY 2020

FY 2021

FY 2022

Estimated Staff

8.13 FTEs

8.13 FTEs

47.63 FTES

43.61 FTEs

 

 

 

 

 

Staffing Costs

$399,490

$1,126,240

$2,382,360

$4,247,840

Development Costs

$0

$5,000,000

$5,000,000

$0

Other Costs

$203,000

$210,000

$272,000

$2,120,000

Total

$602,490

$6,336,240

$7,654,360

$6,367,840

 

The Insurance Department does not believe there are any companies offering insurance benefits similar to those being contemplated by this bill.  The Department indicates the bill would have no impact on the premium tax or the Department’s operations.  The Department assumes the program will be administered by the Department of Employment Security and not subject to Insurance Department oversight.  

 

AGENCIES CONTACTED:

New Hampshire Employment Security and Insurance Department

 

 

HB 628-FN - AS AMENDED BY THE HOUSE

 

9Jan2018... 2481h

8Feb2018... 0225h

2017 SESSION

17-0016

06/10

 

HOUSE BILL 628-FN

 

AN ACT relative to a family and medical leave insurance program.

 

SPONSORS: Rep. Gile, Merr. 27; Rep. Wallner, Merr. 10; Rep. LeBrun, Hills. 32; Rep. Rosenwald, Hills. 30; Rep. Fothergill, Coos 1; Rep. Gargasz, Hills. 27; Rep. McMahon, Rock. 7; Rep. Cilley, Straf. 4; Rep. King, Hills. 33; Sen. Woodburn, Dist 1; Sen. Fuller Clark, Dist 21; Sen. Feltes, Dist 15

 

COMMITTEE: Labor, Industrial and Rehabilitative Services

 

─────────────────────────────────────────────────────────────────

 

ANALYSIS

 

This bill establishes a system of paid family and medical leave insurance.

 

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -

 

Explanation: Matter added to current law appears in bold italics.

Matter removed from current law appears [in brackets and struckthrough.]

Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.

 

 

9Jan2018... 2481h

8Feb2018... 0225h 17-0016

06/10

 

STATE OF NEW HAMPSHIRE

 

In the Year of Our Lord Two Thousand Seventeen

 

AN ACT relative to a family and medical leave insurance program.

 

Be it Enacted by the Senate and House of Representatives in General Court convened:

 

1  New Chapter; Family and Medical Leave Insurance.  Amend RSA by inserting after chapter 282-A the following new chapter:

CHAPTER 282-B

FAMILY AND MEDICAL LEAVE INSURANCE

282-B:1  Findings.  The general court finds that family and medical leave insurance will help New Hampshire attract and retain workers, including younger workers, will enable parents to bond with biological, adopted, or foster children, will help meet the needs of an aging population, will advance the health of New Hampshire's workforce and workplace stability, and will enhance worker retention and productivity.  The general court therefore finds that it is in the public interest to establish a system of family and medical leave insurance (FMLI) with benefits to be provided to qualified workers on a limited basis.

282-B:2  Definitions.  In this chapter:

I.  "Benefit year" means the 12-month period beginning with the first day of the calendar week in which the individual next files an application for FMLI benefits after the expiration of the individual's last preceding application year.

II.  "Calendar quarter" has the same meaning as in RSA 282-A5.

III.  "Child" has the same meaning as "son or daughter" in 29 U.S.C. section 2611(12).

IV.  "Commissioner" means the commissioner of the department of employment security.

V.  "Department" means the department of employment security.

VI.  "Employer" has the same definition as relevant provisions of RSA 282-A:8., except as provided in RSA 282-A:9.

VII.  "Employment" means wages paid for services by an employer that is covered by this chapter.

VIII.  “Family member” means a “child”, as defined in RSA 282-B:2, III, a biological, adoptive or foster parent, stepparent, or legal guardian of the child or the child’s spouse or domestic partner, a biological, adoptive, or foster grandparent or  step grandparent, or a spouse or domestic partner under RSA 457.

IX.  "Family and medical leave" means leave from work:

(a)  Because of the birth of a child of the employee, within the past 12 months; or

(b)  Because of the placement of a child with the employee for adoption or fostering, within the past 12 months; or

(c)  Because of a serious health condition of a family member; or

(d)  Because of a serious health condition of the employee that isn't related to employment.

X.  "FMLI" means family and medical leave insurance.

XI.  "Federal Family and Medical Leave Act" means the federal Family and Medical Leave Act of 1993, 29 U.S.C. chapter 28.

XII.  "Serious health condition" means any illness covered by the federal family and medical leave act including treatment for addiction as prescribed by a treating clinician, consistent with American Society of Addiction Medicine criteria, as well as treatment for a mental health condition, consistent with American Psychiatric Association criteria.

XIII.  "Fund" means the family and medical leave insurance fund as described in RSA 282-B:4.

282-B:3  Employer Applicability.

I.  This chapter applies to all nongovernmental employers, provided that any employer participating in a self-insured plan or who is self-insured may opt out of this chapter upon certification by the commissioner or authorized representative that the employer provides an equivalent benefit for its employees.  The state or its political subdivisions may opt into this chapter upon certification by the commissioner or authorized representative that this chapter's insurance benefits are at least equivalent to the benefits provided under the collective bargaining agreement, provided the applicable bargaining unit has first ratified this option.

II.  All employers subject to this chapter shall remit FMLI premium payments on a calendar quarter basis.  These quarterly insurance premium payments shall amount to 0.67 percent of wages per employee per week for each week of the preceding quarter.  Employers may withhold or divert no greater than 0.67 percent of wages per week per employee to satisfy this paragraph, provided that such employers provide employees, before employment commences, a department approved information sheet containing conspicuous language explaining the costs and benefits of the insurance and indicating that employees are able to affirmatively opt-out of the insurance by downloading a form from the department and that such form, if the employee chooses to opt-out, shall be notarized and submitted to the department and the employer before employment commences, and that the employee shall be provided the opportunity to opt in on January 1 of each year.  No employer shall make opting-out of the insurance a condition of employment nor discriminate against an employee in compensation or in terms, conditions, or privileges of employment based on whether or not the employee opts-out of the insurance.

III.  The penalties for falsity by employers shall be in accordance and consistent with RSA 282-A:166.  The process for failing to adequately report shall be in accordance and consistent with RSA 282-A:151-152 and 282-A:166-a, and any resulting appeals shall be processed in accordance and consistent with RSA 282-A:94-98.

282-B:4  Family and Medical Leave Insurance Fund Administration.  The department shall create and administer a family and medical leave insurance fund for deposits of insurance payments paid pursuant to RSA 282-B:3, and accept any other deposit of moneys as authorized by law or by the commissioner or authorized representative.  No FMLI fund moneys shall be co-mingled with unemployment insurance fund moneys.  The department is authorized to withdraw or deduct from the FMLI fund where there are qualifying FMLI benefit payments or for any amounts reasonably necessary to implement and administer the provisions of this chapter.

282-B:5  Employer and Employee Responsibilities.

I.  An employee shall both file an application with the department, including any applicable medical certification or birth certificate, and provide his or her employer with written notice of intent to take a leave of absence at least 30 days before the leave will begin unless the leave was not reasonably foreseeable or the time of the leave changes due to circumstances that were not reasonably foreseeable.  An employee's failure to provide required notice may delay or reduce benefits.

II.  Any employee of an employer covered under the federal Family and Medical Leave Act who takes leave under this chapter shall be restored to the position he or she held in the application period or to an equivalent position by his or her employer.  Employers shall continue to provide health insurance to employees during the leave, but employees remain responsible for any employee-shared costs associated with the health insurance benefits.  Employers shall not retaliate against any employee solely for exercising his or her rights under this chapter.

III.  An employer may require that leave taken under this chapter be taken concurrently or otherwise coordinated with leave allowed under the terms of a collective bargaining agreement or employer policy.  The employer shall give individuals in its employ written notice of this requirement.

282-B:6  Eligibility Process, Calculation and Appeals.

I.  An employee shall be limited up to 6 weeks of FMLI in any one application period.  An employee shall have had premium payments remitted as a percent of his or her wages for at least 6 months to be eligible for benefits and shall have worked in employment resulting in wages in the amount of at least 1,040 multiplied by the applicable minimum wage, in either the “base period” or “alternative base period”, as those terms are defined in RSA  282-A:2.

II.  An employee shall be eligible for FMLI for reasons identified in paragraph I and RSA 282-B:2, IX.

III.  The calculation of weekly FMLI benefits shall be the highest quarter of wages in either the base period or alternate base period as defined in RSA 282-A:2, then divided by 13 and multiplied by 0.6, provided that no such calculation of FMLI benefits shall be less than $125 per week or greater than 0.85 of the average weekly wage in New Hampshire.  The calculation for partial FMLI benefits shall be in a manner consistent with RSA 282-A:14.

IV.  The process for FMLI benefits claims, violations, and any resulting appeals shall be in accordance and consistent with RSA 282-A:42 through RSA 282:68 and RSA 282-A:118.  The standard and process for handling overpayments shall be in accordance and consistent with RSA 282-A:29, RSA 282-A:141-RSA 282-A:156 and RSA 282-A:165.  In addition, an individual shall be disqualified from FMLI benefits beginning with the first day of the calendar week, and continuing for the next 26 weeks, in which the individual has been found to willfully made a false statement or misrepresentation regarding a material fact, or willfully failed to report a material fact, to obtain benefits under this chapter.

285-B:7  Limitations.  Nothing in this chapter shall diminish an employer's obligation to comply with a collective bargaining agreement or employer policy, nor does this chapter, or any decision by the commissioner or authorized representative under this chapter, limit the ability of employers to provide FMLI benefits or benefits beyond what is required by this chapter.

282-B:8  Report and Outreach.  

I.  The department shall make public and provide semi-annual reports to the governor, senate president, speaker of the house of representatives, and the advisory council established pursuant to RSA 282-A:128 involving a summary to include but not be limited to, compliance with this chapter, payments into and out of the fund, fund balance, participation rates including for low wage employees, and retention of employees who received FMLI benefits.

II.  The department shall develop and implement an outreach program to ensure that individuals who may be eligible to receive FMLI benefits under this chapter are made aware of these benefits.  Outreach information shall explain in an easy to understand format, eligibility requirements, the claims process, weekly benefit amounts, maximum benefits available, notice requirements, reinstatement and non-discrimination rights, confidentiality, and coordination of leave under this chapter and other laws, collective bargaining agreements, and employer policies.

282-B:9  Rulemaking.  The commissioner shall adopt rules, pursuant to RSA 541-A,  relative to this chapter.  In adopting rules, the commissioner shall maintain consistency with the rules adopted to implement the federal Family and Medical Leave Act, to the extent such rules are not in conflict with this chapter.

2  Advisory Council.  Amend RSA 282-A:128 to read as follows:

282-A:128  Advisory Council.  There is hereby created within the unemployment compensation bureau an advisory council on unemployment compensation and family medical leave insurance, hereinafter called the advisory council.  The advisory council shall consist of 9 members to be appointed, with the exception of the legislative members, by the governor with the consent and advice of the governor's council.  Three of the appointees of this advisory council shall be persons who, because of their vocations, employment or affiliations, shall be classed as representing the point of view of employers; 3 shall be persons who, because of their vocations, employment or affiliations, shall be classed as representing the point of view of employees; one shall be a senator from the insurance committee appointed by the senate president; one shall be a representative from the labor, industrial and rehabilitative services committee appointed by the speaker of the house; the remaining appointee, who shall be designated as chairman, shall be a person whose training and experience qualify him to deal with the problems of unemployment compensation.  Such advisory council shall meet no later than 45 days after each calendar quarter and aid the commissioner in formulating policies and discussing problems related to the administration of this chapter and RSA 282-B and in assuring impartiality and freedom from political influence in the solution of such problems.  Advisory council meetings shall provide opportunity for public comment.  The advisory council shall quarterly review and evaluate family medical leave insurance and, after 2 years of administration, the commissioner shall assess utilization, finances, and benefit levels and provide the general court with rate adjustment or fiscal recommendations.

3  New Subparagraph; State Treasurer; Application of Receipts.  Amend RSA 6:12, I(b) by inserting after subparagraph (339) the following new subparagraph:

(340)  Moneys deposited in the family and medial leave insurance fund established in RSA 282-B:4.

4  Family and Medical Leave Insurance Program; Funding.  The initial administrative and implementation costs associated with this chapter shall either be a capital appropriation included in the state capital budget of the 2019 legislative session or an appropriation in fiscal year 2020 in the operating budget for the biennium ending June 30, 2021.  Initial administrative and implementation costs shall be reimbursed to the general fund within 10 years.

5  Effective Date.  This act shall take effect January 1, 2019.

 

LBAO

17-0016

Amended 2/23/18

 

HB 628-FN- FISCAL NOTE

AS AMENDED BY THE HOUSE (AMENDMENT #2018-0225h)

 

AN ACT relative to a family and medical leave insurance program.

 

FISCAL IMPACT:      [ X ] State              [    ] County               [    ] Local              [    ] None

 

 

 

Estimated Increase / (Decrease)

STATE:

FY 2019

FY 2020

FY 2021

FY 2022

   Appropriation

$0

Indeterminable

Indeterminable

$0

   Revenue

$0

$0

$0

Indeterminable Increase

   Expenditures

Indeterminable Increase

Indeterminable Increase

Indeterminable Increase

Indeterminable Increase

Funding Source:

  [ X ] General            [    ] Education            [    ] Highway           [ X ] Other

 

 

 

 

 

METHODOLOGY:

This bill creates a family and medical leave insurance program (FMLI) to be administered by the Department of Employment Security.  The program would apply to non-governmental employers but allow an employer to opt out if they are able to demonstrate they provide an equivalent insurance plan for employees.  The state and political subdivisions would be allowed to opt into the program but would be required to show benefits available in the program are at least equivalent to the benefits provided under their existing plan.  Initial administrative and implementation costs would be funded with a capital or operating budget appropriation in the FY 2019 legislative session.  

 

The Department of Employment Security has no information on which, if any, governmental entities would opt into the program, whether there would be any cost or benefit to doing so, or whether such action would be revenue neutral.  The bill would allow employees the ability to opt-out before employment commences.  An employee choosing to opt-out would have the opportunity to opt-in each January 1st.  It is not possible to estimate with any degree of certainty how many employees would choose to opt-out of the program or how many employees electing to participate in the insurance program would utilize the benefits available under the program.  The proposed benefit would be funded through 0.67 percent of participating employee wages withheld per week per employee.  Participating and qualifying employees would then be able to apply for up to 6 weeks of leave during any 12 month period. The weekly benefit is calculated at 60% of the employee’s average weekly wage during the highest earning quarter of the employee’s base period as defined in the legislation but no less than $125 per week, and no higher than 85% of the average weekly wage in New Hampshire.

 

The Department of Employment Security will be responsible for the creation and administration of the FMLI program.  The Department would accept and manage employer deposits into the FMLI Fund, adjudicate and pay benefits from the fund to eligible individuals and provide outreach and awareness regarding the FMLI program.  The Department estimates it would take 24 months to develop an information technology system to be able to accept and account for the revenue: take claims for benefits; adjudicate claims for benefits; and process appeals.  The project would start with the development of the enhancements to the current tax system in order to be able to accept and account for revenue.  This is expected to take 24 months and involve existing program staff from the Department of Employment Security and existing as well as new staff from the Department of Information Technology (DoIT).

 

A new benefit application would require 24 months to develop and launch and would be accomplished by contracting with an IT vendor.  The services would be procured through a competitive bid process and development could only begin after the contract is finalized.  The Department estimates it could take up to 6 months from the effective date of the bill for development of the benefit application to begin.  Therefore, the Department estimates the development period will be 30 months.  The benefit application would be designed by existing department staff working in collaboration with the IT vendor.  Once complete, the program would be administered by existing and new department staff.  The benefit application itself would be maintained by the IT vendor.  While the bill authorizes the Department to withdraw or deduct from the FMLI fund amounts reasonably necessary to implement and administer the FMLI program, the initial system development and staffing costs would be incurred before the program begins operation.  This would require an alternative funding source for program development and initial program launch.

 

The program would include a new public facing online application for filing for benefits and an internal staff view for adjudicating eligibility and electronic payment of benefits. The benefit application would include all of the conveniences currently provided to individuals for unemployment benefits.  The annual maintenance cost for the benefit payment application is estimated at $2,000,000 and would paid to the outside IT vendor chosen to administer and maintain the application.  This is consistent with the industry standard for maintenance costs of 20% of development costs.  Additional hardware to support the new benefit and revenue applications and database would be a one-time cost of $400,000.  The Department anticipates the new revenue application would be developed and maintained by state DoIT employees. The application would include all the same conveniences currently provided to employers for unemployment insurance taxes.

 

The staff costs include the cost to develop, test, launch and maintain the revenue application, costs to test and launch the benefit application, and ongoing costs for program maintenance after development is complete.  The majority of the staffing costs in FY 2019 and FY 2020 will be for existing and new DoIT staff working with Department of Employment Security staff to develop the revenue application.  In FY 2021 the staff costs will transition to from development costs to program costs.  

 

The Department estimates the following staff and costs to develop, test, and launch the program:

 

Program Development

Maintenance

 

FY 2019

FY 2020

FY 2021

FY 2022

Estimated Staff

8.13 FTEs

8.13 FTEs

47.63 FTES

43.61 FTEs

 

 

 

 

 

Staffing Costs

$399,490

$1,126,240

$2,382,360

$4,247,840

Development Costs

$0

$5,000,000

$5,000,000

$0

Other Costs

$203,000

$210,000

$272,000

$2,120,000

Total

$602,490

$6,336,240

$7,654,360

$6,367,840

 

The Insurance Department does not believe there are any companies offering insurance benefits similar to those being contemplated by this bill.  The Department indicates the bill would have no impact on the premium tax or the Department’s operations.  The Department assumes the program will be administered by the Department of Employment Security and not subject to Insurance Department oversight.  

 

AGENCIES CONTACTED:

New Hampshire Employment Security and Insurance Department