Paid Family Leave: Information for Employers
On July 1, 2019, the District began collecting taxes from all local employers to fund the Paid Family Leave benefit. The payroll tax will be paid by covered employers, even if you provide additional leave benefits to your workers.
On July 1, 2020, the district began administering paid family leave benefits to workers.
In the end, this levels the playing field for small businesses. Many of us want to offer Paid Family Leave to our workers, but we just can't afford to do so on our own. -DC Small Business Owner
What does Paid Family Leave mean for DC employers?
Doing business in DC and offering Paid Family Leave to workers makes local employers more competitive. Smaller businesses can offer the same benefits as larger companies, and DC businesses are more attractive than those in other states.
Other cities implementing Paid Family Leave policies have found that employers benefit from decreased turnover and higher retention. This reduces costs related to hiring and training new workers, and also increases the morale of workers, according to the Penn Wharton Public Policy Initiative.
As an employer of workers in DC, what do I need to do?
Resources for Employers
- Establish or update your account on the DOES online portal. Quarterly wage reports and tax payments are submitted through an online portal, which will be available to employers prior to the beginning of the collection of the payroll tax.
- Contribute to the Paid Leave Implementation Fund. Paid Family Leave benefit payments are funded by a quarterly payroll tax based on the immediate past quarter of gross or total wages paid, much like the unemployment insurance tax. To make a payment, please see the Payment Instructions document located under the Resources for Employers section.
- Post an employee notice (updated October 1, 2023). The notice about Paid Family Leave must be posted in a place that is accessible to all workers. The notice will be updated each October and required to be posted no later than the following February.
- Inform your workers about Paid Family Leave. Share the information upon hiring, share annually for all workers, and when Paid Family Leave is needed.
- Maintain documentation. Record your workers’ wages and related communications.
Potential Impact of Paid Family Leave
Research from Penn Wharton Public Policy Initiative shows that Paid Family Leave can boost morale among workers. Happier workers are more motivated and efficient, which improve a business’ success and stability.
Prevent Lost Wages
Without Paid Family Leave, women are discouraged from staying in the workforce so they can care for family members. As a result, they can lose an estimated $274,044 in lifetime wages, according to a study by the MetLife Mature Market Institute.
Some employers in California, New Jersey, and Rhode Island were initially resistant to implementing a Paid Family Leave policy. But after implementation, surveys of employers showed they were more likely to have positive or neutral views than negative views, according to research by the National Bureau of Economic Research.