New York State requires Disability Insurance for Farmers

New York State requires Disability Insurance for Farmers

New York State requires Disability Insurance for Farmers

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Starting January 1, 2018, New York State mandated that employers must provide all employees paid Family Leave benefits along with their statutory New York State Disability coverage.

Traditionally farms were exempt from New York State Disability laws and requirements.  Farms were only required to provide statutory New York State Disability Benefits under the following 3 situations:

  1. The farm had an office/administration personnel
  2. The farm had a retail farm market
  3. The farm had a packing operation where they were packing products or produce of others.

In July 2019, Governor Cuomo signed the Farmowners Labor Bill and established the Farm laborers Fair Labor Practices Act which takes effect January 1, 2020.  Under this law, there are important labor requirements for farm employees, owners, and operators, including important changed requiring coverage changes for:

  1. New York State Disability benefits
  2. New York State Paid Family Leave benefits
  3. New York State Workers Compensation requirements

New York State disability benefits provide income coverage to your employees when they are unable to work because they got hurt off the job.  You may have an employee who blows out a knee playing in a baseball league or a pick up basketball game.  Female employees can go out on disability leave due to pregnancy, any time during the pregnancy.  There is a statutory 7-day waiting period.  Statutory Disability payments are not made until the 8th day of disability, and the employee must file a claim within 30 days of disablement.  New York State disability benefits pay 50% of the employee’s weekly take-home pay to a maximum of $170.00/week.  The weekly benefit will pay up to 26 weeks.  You must be under the care of a physician, chiropractor, podiatrist, psychologist, dentist or certified nurse midwife in order to qualify for benefits.

For small businesses with fewer than 50 employees, the premium rates are calculated as a premium per male or female per month.

           Example:  Males are $1.75/month to a total annual premium of $21.00.
                            Females are $3.80/month to a total annual premium of $45.00
                           (The female rates are higher due to coverage for childbirth).

These monthly and annual premiums can be cost-shared between the employer and employee payroll deduction contributions.  The maximum employee weekly contribution cannot be more than $0.60 per week.  I have always paid 100% of the annual premium for statutory New York State Disability as an employer.  I have only had between 2 and 4 full-time employees in any 1 year.

Not only are farm employers, owners, and operators required to provide statutory New York State disability coverage but also Paid Family Leave coverage.

New York State employees can take time from work and qualify for Paid Family Leave benefits when faced with a qualifying event in their life.  An example of qualifying events could include:

1. Bonding with a newborn child. 

You can take Paid Family Leave for bonding with a new child at any time within the first 12 months of the child’s birth.  The same benefit covers the placement of children through adoption or foster care.

2. Care for a family member.

You can take Paid Family Leave to assist family members after major surgery or a long term serious health condition.  Family members include employees, spouse, children, parents, parents in law, grandparent or grandchild.  These family members can live outside New York State or the United States.

3. Assist Military families.

You can take Paid Family Leave to assist loved ones when a spouse, child or parent is deployed abroad.

The time off benefits provided by New York State’s Paid Family Leave are as follows:

            2018  50%   of an employee’s average weekly pay up to the designated % of NYS average weekly wage.

            2019  55%   of an employee’s average weekly pay up to the designated % of NYS average weekly wage.

            2020  60%   of an employee’s average weekly pay up to the designated % of NYS average weekly wage.

            2021  62%   of an employee’s average weekly pay up to the designated % of NYS average weekly wage.

An example for an employee who takes Paid Family Leave in 2019:

They would receive 55% of their own average weekly wage but would be capped at 55% of New York States’ average weekly wage.  The maximum weekly benefit for 2019 is $746.61.

So, this weekly benefit will increase over the next 2 years because the % benefit increases and as New York State makes inflammatory adjustments to the state’s average weekly wages.

Premiums for Paid Family Leave are paid by the employer along with the employees premiums for their statutory New York State Disability policy.

However, premiums are funded through employee payroll deductions. 

2018 – An employee’s payroll deduction was 0.126% of their weekly wage.  The maximum cap was $85.56 annually.  If an employee earned $27,000 for the year or $519.00/week their weekly contribution would have been $0.65 per week.

2019 – an employee’s payroll deduction was .153% of their hourly wage.  The maximum cap was $107.97 annually.

Currently: An employee’s payroll deduction is 0.22% of their weekly wage.  The maximum cap is now $196.72/year.

We will see increases in premium cost as the length of benefits by week increase, the % of covered wages increase and as the New York State Department of Labor’s average weekly wage increases.  New York State announces the change in average weekly wage by March 31rst of each year.

As farm owners and employees, we must be aware that the Paid Family Leave Act also provided rights and protections to our employees.  When and/or if an employee leaves work and makes a claim for Paid Family Leave you must :

  1. Protect their job.  You must hire them back at the end of their benefit period to the same job or a meaningful equivalent; even if you had to hire a replacement or temporary help.
  2. If you provide benefits to your employees such as health insurance, you must continue the benefit as if the employee was working.
  3. There must be no discrimination and/or retaliation to an employee for requesting or taking benefits under the Paid Family Leave Act.

Previous to the Farm Workers Labor Bill a farm with less than $1,200 of annual payroll was not required to carry and provide New York State Worker’s Compensation insurance.  COVERAGE IS NOW MANDANTORY.  All employers are required to provide workers compensation coverage for their employees regardless of annual payroll.

New York State Workers Compensation Insurance provides these critical coverages for your employees:

  1. It covers all necessary medical expenses related to an employee injury at work on the farm.
  2. It covers a percentage of their average weekly wages when an employee is unable to return to work from an injury.  It provides payments if the injury causes a partial or permanent disability.
  3. It protects the farm owner/operator from full employee liability when and if an injured employee or related family member were to sue you. The farm liability portion of your Farmowners policy excludes employee-related liability.

The Farm Worker Labor Bill also mandates poster requirements to be both in English and Spanish.  There are also new notice requirements for farm contracts.

For more information go to www.wcb.ny.gov/farmtoolkit

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