New Year, New CT Payroll Tax: Here's What To Know

CONNECTICUT — Employees in Connecticut will see a new payroll deduction starting Jan. 1 to help fund Connecticut's Paid Family Leave Program.

The program will build up funds for a year and employees will be eligible for benefits in January 2022. Employees will be able to access paid leave benefits that are covered under the federal Family and Medical Leave Act and the Connecticut Family and Medical Leave Act, as well as the Connecticut Family Violence Leave Act.

The program covers all employers with one or more employees. Self-employed and sole proprietors can opt in to the program if they wish.

How much will be taken out of my paycheck?

Employees will have 0.5 percent deducted from their wages, up to the federal Social Security wage maximum, which is $142,800 for 2021. That equates to $250 yearly for someone making a $50,000 salary. The state provides this contribution estimator.

How long is leave?

Employees will be eligible for up to 12 weeks of paid leave benefits if they meet the qualifications. There is an additional two-week benefit for serious health conditions that occur during pregnancy.

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How much will I get paid if I take leave?

Employees earning less than or equal to the state's minimum wage multiplied by 40 ($520 weekly in 2022) will get 95 percent of their average weekly wage. That is a maximum of $494 weekly in 2022.
Employees whose wages exceed that amount will get the $494 weekly benefit plus 60 percent of their average weekly wage up to 60 times the state's minimum wage.

The maximum benefit in 2022 will be $780 weekly.

However, those benefit rates can be reduced if there isn't enough revenue in the program to cover them.

There is also a wage threshold to qualify. From the state's paid leave website:

"Covered employees in Connecticut are eligible for benefits under the PFMLA if they have earned wages of at least $2,325 in the highest quarter of the first four of the five most recently completed quarters and are currently employed, or have been employed within the last 12 weeks, or are self-employed, a sole proprietor and a Connecticut resident enrolled in the program."Wages may include salary or hourly pay, vacation pay, holiday pay, tips, commissions, severance pay and the cash value of any "in-kind" payments.

What are some qualifying events?

• Caring for a new child by birth, adoption or fostering.
• If you or a family member is dealing with a serious health condition.
• Those serving as an organ or bone marrow donor.
• Victims of family violence are eligible for up to 12 days of paid benefits to seek medical or psychological care, to relocate or to participate in civil or criminal proceedings.
• Caring for a family member who was injured on active duty in the armed forces.

Are there exemptions?

Employers can opt out of making contributions if they offer employees a plan that provides the same or better benefits than the state plan.