The leave landscape in the U.S. is a constantly evolving and complex aspect of the current employee benefits world. While mandatory paid leave was first introduced in the 1940s with Rhode Island as the first state to offer state paid disability leave, it certainly hasn’t been the last. A movement that started out fairly slow has picked up speed, especially over the last several years. We now have 26 states/jurisdictions with some form of paid leave.
While the programs come in different flavors – Statutory Disability, Statutory Disability + Paid Family Leave (PFL), Mandated Paid Family and Medical Leave (PFML), Voluntary PFML – for anyone working in employee benefits in 2025, these offerings need to be on your radar.
At Reliance Matrix, we live and breathe paid leave every day. Two key resources we provide to the market include:
Is paid leave different from FMLA?
Yes. While paid leave does often work in conjunction with FMLA, there are key differences between the two:
What is the current leave landscape?
The phrase “leave landscape” mainly refers to state unpaid and paid leave. Today, that includes not only an expansion of leave by state but an evolution of the type of leave. Mandatory leave laws no longer fit into just statutory disability, paid family leave, or both – now the law can be voluntary or can allow insurance carriers to offer an insured family leave product.
Why is leave important?
There are benefits of paid leave for both employees and employers:
- For employees: provides job protection (not all states), income replacement, and peace of mind during a difficult time in their personal lives.
- For employers: although mandatory coverage is a requirement, additional or expanded leave policies can attract and help retain talent and provide support during a time an employee may otherwise leave employment.
What else should employers be aware of?
While options can vary by state, employers do have decisions to make when it comes to paid leave, especially for mandatory PFML programs:
- Go with a fully insured or self-insured plan?
- Get coverage directly through the state or go with a private plan, either from an approved insurance carrier (for fully insured) or TPA (for self insured)?
What are employer requirements and best practices if going with a private plan for PFML?
Employer requirements broadly refer to the employer’s obligations under the law. While each state has a specific set of requirements, generally speaking,employers interested in a private PFML plan must:
- Provide notice to employees regarding their rights under the law and where to file a claim;
- Provide the state with claims and/or financial reports, and
- Employers with approved private plan exemption must file timely renewals.
For many employers, especially those with employees working in the states we’ve mentioned, going with a private plan can make a lot of sense. By partnering with a carrier or TPA for a full absence solution, all leave types can be handled and coordinated by the same team. That being said, there are still a few best practices employers should implement when going with a private plan:
- Designate an internal go-to person/“expert” as the point of contact for the state division overseeing the program. They need to understand enough of the requirements and timelines to be able to interact with the state – and with the carrier or TPA.
- Ensure internal employment policies align with state requirements.
What role do brokers play in the world of paid leave?
Paid leave is a critical component of the current employee benefits landscape – and should be considered just as important as any other ancillary coverage. For employers who have employees working in any of the states we’ve mentioned, they are going to have questions. And as employers look to place absence, life, disability, and supplemental health with the same carrier to streamline the claimant experience, brokers who understand these offerings and how they interact with other coverages are going to stand out. While becoming proficient in the nuances of every state can be a challenge, partnering with a carrier who is entrenched in these offerings on a daily basis helps you bring solutions and value to your clients.
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