Starting in 2027, Massachusetts employers will no longer be required to contribute to the state’s Paid Family and Medical Leave (PFML) program. According to the Massachusetts Department of Family and Medical Leave (DFML), the statutory shift mandates that employees will become solely responsible for the full contribution rate, marking a significant change from the current cost-sharing model between businesses and their staff.
Understanding the 2027 Contribution Shift
The Massachusetts PFML program, which provides eligible workers with paid leave for family and medical reasons, currently operates on a split-contribution basis. Under existing law, the total contribution rate is divided between the employer and the employee. Employers are responsible for a portion of the premiums for medical leave and may choose to cover a portion of family leave premiums, though they are not required to do so.
Beginning January 1, 2027, this structure changes. The Massachusetts General Laws Chapter 175M dictates that the employer share of the contribution will be eliminated. From that date forward, the entire premium—covering both family and medical leave—will be deducted from the employee’s wages. Employers will maintain their administrative obligations, such as calculating, collecting, and remitting these contributions to the state, but the financial burden for the premiums will shift entirely to the workforce.
Current vs. Future Contribution Requirements
To understand the impact of this change, it is necessary to look at how the program functions today. As of 2024, the DFML sets an annual contribution rate that fluctuates based on the state’s economic and actuarial needs.
- Current Model (Through 2026): Employers and employees share the cost of medical leave premiums. Employers are permitted, but not required, to deduct up to 40% of the medical leave contribution from an employee’s paycheck. For family leave, employers are not required to contribute, but they may choose to do so.
- Future Model (Starting 2027): The employer’s mandatory contribution to the PFML fund drops to 0%. The employee becomes responsible for the entirety of the premium as determined by the state’s annual rate setting process.
Administrative Obligations for Employers
While the financial responsibility for premiums will shift to employees in 2027, the employer’s role in the PFML lifecycle remains largely unchanged. According to official state guidance, employers remain responsible for:
- Calculating Deductions: Employers must continue to calculate the correct contribution amounts based on the annual rate set by the DFML.
- Payroll Withholding: Businesses must withhold the total premium amount from employee paychecks.
- Remittance: Employers are required to remit these funds to the Department of Family and Medical Leave via the MassTaxConnect portal.
- Notification: Employers must continue to provide employees with mandatory notices regarding their rights and the status of their contributions.
Frequently Asked Questions
Will employees see a change in their take-home pay in 2027?
Yes. Because the full premium will be deducted from employee wages rather than split with the employer, employees will see an increase in the PFML deduction on their pay stubs.
Do employers have to pay anything toward PFML in 2027?
No. The law removes the employer’s requirement to contribute to the premium. However, employers must still manage the administrative process of collecting and sending the employee-funded premiums to the state.
Does this change affect the benefits employees receive?
No. The shift in contribution responsibility does not alter the amount of paid leave time or the benefit payout levels available to eligible employees under the Massachusetts PFML program.
Are there exceptions for small businesses?
Current state law generally requires employers to collect and remit contributions regardless of size, though small businesses with fewer than 25 employees are currently exempt from the employer share of the medical leave premium. The 2027 change simplifies this by removing the employer share requirement for all businesses.