Agenda - Council Work Session - 07/08/2025

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CC Work Session Meeting Date: Primary Strategic Plan Initiative: 2. 1. 07/08/2025 Information Title: Discuss Paid Family Medical Leave, Administrative Options and Cost Sharing Purpose/Background: This case, as shown below, provides additional information in an attempt to provide a general overview of the new Paid Family Medical Leave law and processes. Specifically, staff will need the City Council's direction regarding 1) consensus direction to opt for a private vendor, and 2) consensus direction regarding cost sharing. One private vendor, Met Life, is approximately $10,000less expensive than the State of Minnesota and has experience administering the program in other states. Background of the Program Paid Family Medical Leave will have an administrative impact on the City's Human Resources staff and Finance Department staff in terms of overseeing the program; how much of an impact is yet to be seen. According to the State of Minnesota, it created its Paid Family and Medical Leave (PFML) program to ensure that workers can take time off for major life events without sacrificing their income or job security. The program has many similarities to the Federal Family Medical Leave Act, but that program can be paid or unpaid and is more narrow in its eligibility. The new program, launching in 2026, is rooted in a few key goals: - Support for Families: It allows people to care for a new child, a seriously ill loved one, or recover from their own health issues —without financial strain. - Economic Stability: By providing partial wage replacement, the program helps families stay afloat during difficult times, reducing reliance on emergency aid or debt. - Workforce Retention: Employees are more likely to return to work after leave, which benefits employers by reducing turnover and training costs. - Equity and Access: Not all workers have access to paid leave through their employers. This state -run program levels the playing field, especially for part-time, low -wage, or gig workers. - Public Health and Well-being: Encouraging people to take time off when needed can lead to better health outcomes and stronger family bonds. The program is funded through a shared premium between employers and employees, and it covers up to 20 weeks of leave per year for qualifying events Plans Equivalent to the State plans for Paid Leave Employers can choose to meet their responsibilities under Minnesota Paid Leave by providing employees with an equivalent plan that meets or exceeds the coverage offered by the state. There are two types of paid leave equivalent plans: 1) Insurance carrier plans and 2) Self -insured plans. An equivalent plan must offer the same or better coverage than Minnesota Paid Leave, and it must not cost your workers more than they would be required to contribute under the state plan. It must also provide job protections equal to those in the state plan. There is a one-time $500 fee payable to the State if a private vendor option is implemented. Employers approved for an equivalent plan will not pay premiums to the state, but will have other obligations under Minnesota Paid Leave. Employers must still submit wage detail reports to the state each quarter and comply with requirements to notify employees about paid leave coverage. Minnesota Paid Leave provides both Medical Leave, for an employee's own healthcare needs, and Family Leave,