All employers are required to do one of the following:
- Withhold employees’ premiums from their paychecks, OR
- Pay some or all of the premium on their employees’ behalf
Employers cannot collect missed premiums in later pay periods
For 2020, the Paid Leave premium is 0.4% of each employee’s gross wages (pre-tax wages, minus tips).
- Of this 0.4% of gross wages, employees pay 63.33%, and the employer pays the other 36.67.
- Premiums are capped at the 2020 Social Security Wage Base of $137,700. (The Social Security Wage Base for 2021 will be $142,800.)
Businesses with fewer than 50 employees are not required to pay the employer portion of the premium, but they still must:
- Collect employee premiums, OR
- Pay employee premiums on their behalf
If you are using a voluntary plan for family or medical leave, your calculations may be different.