California Paid Family Leave And State Disability Insurance Benefits Revised

On September 30th, 2022, California Governor Newsom signed Senate Bill (SB) 951, which will increase the wage replacement rate for lower wage earners under the state Paid Family Leave Program (PFL) and State Disability Insurance (SDI) programs. A similar bill was vetoed last year.

PFL provides short-term wage replacement benefits to eligible California workers. You may be eligible for PFL if you cannot work, resulting in lost wages and time off work for family leave. California’s SDI program provides short-term disability insurance to individuals who are unable to work due to non-work-related illness or injury, pregnancy, or childbirth.

What The New Bill Means

Beginning in 2025, individuals who earn 70 percent or less than the state’s average wage are eligible for 90 percent of their regular wages under the PFL and SDI programs. Currently, workers who earn low wages may be eligible for 70 percent of their regular wages under the programs.

Governor Newsom expressed, “My administration has been a strong advocate for expanding access to DI and PFL programs, and I am proud of the progress we have made in collaboration with the Legislature… SB 951 will create significant new costs not included in the 2021 Budget Act and would result in higher disability contributions paid by employees.”

Additional Steps

Whether your organization lacks an HR department or HR team or needs a resource to make more informed decisions about benefits management, GMS can help. Our benefits outsourcing services allow your business to offer competitive, cost-effective benefits while you focus on what you do best, running your business. In addition, while laws and regulations are constantly changing, our team of experts ensures you stay compliant. Should a new law be enforced in the state you run your business operations, we create a strategic plan on how you can begin implementing it within your workplace. Want to learn more about how GMS can help you and your business? Contact us today.