Talbot Employers Planning a Private Paid-Leave Plan Have Until Sunday to Keep 2027 Contributions Out of the State Fund

EASTON, MARYLAND — Talbot County businesses that plan to apply for a private paid family and medical leave plan in 2027, rather than use Maryland's state-run plan, have until Sunday, Nov. 15, to submit a Declaration of Intent with the state's FAMLI program if they want to keep their 2027 contributions from going to the state. The private plan applications themselves do not open until summer 2027.

The declaration matters for cash flow in 2027. An employer whose declaration is accepted does not send its 2027 contributions to the state, but it still has to collect or set aside that money. Starting in January 2027, those employers must hold all contributions in an escrow account kept separate from other funds, with a statutory exception for certain government employers, and they may collect contributions from employees or fund the account themselves, according to the Maryland Department of Labor's FAMLI employer pages.

Every employer with at least one employee in Maryland must register with FAMLI, and registered employers are placed in the State Plan automatically. The state set the first-year contribution rate at 0.9% of wages, up to the Social Security wage cap, split evenly at 0.45% for the employer and 0.45% for the worker. That rate covers wages paid from Jan. 1 through Dec. 31, 2027. Employers with fewer than 15 total employees, counting workers in and outside Maryland, remit only half the rate and may withhold that amount from pay.

Private plans may charge an employer more than the State Plan rate, but no employer may withhold more from a worker than the State Plan would. At the 2027 rate, that cap is 0.45% of wages.

Only an employer's Authorized Officer can submit the declaration, through the business's online FAMLI account, and an officer acting for more than one employer needs a separate declaration for each federal employer ID number. A declaration requires a Proof of Private Plan Consultation form completed and signed by a licensed insurance agent or other representative of an insurance company in Maryland. The state says it will notify the officer of the outcome within 15 business days.

The declaration is a first step. Private plan applications open in summer 2027 and are due Oct. 1, 2027. An employer that submits a declaration but does not apply by then will be told how much it owes the state insurance fund, including contributions and any interest or penalties, and the escrowed money should go toward that bill, the state says. If a commercial private plan is approved, the employer must return employee contributions to its workers; if the application is denied or the employer chooses the State Plan, the escrowed contributions go to the state.

Whatever plan a business uses, it must notify employees about contribution withholding one pay period before deductions begin Jan. 1, 2027, and submit quarterly wage and hour reports starting in April 2027. The first State Plan payment, covering wages paid January through March, is due April 30, 2027.

Talbot County government is pursuing private coverage for its own workforce: the County Council on Nov. 10 unanimously approved submitting a Declaration of Intent and seeking competitive pricing for private coverage, according to the county's meeting highlights.

FAMLI's employer help line is 410-525-4010.