FILED SENATE
Apr 6, 2021
GENERAL ASSEMBLY OF NORTH CAROLINA
S.B. 564
SESSION 2021 PRINCIPAL CLERK
S/H D
SENATE BILL DRS15235-LR-112
Short Title: NC Paid Family Leave Insurance Act. (Public)
Sponsors: Senators Batch, Salvador, and Crawford (Primary Sponsors)./Representative
Meyer.
Referred to:
1 A BILL TO BE ENTITLED
2 AN ACT TO ENACT THE NORTH CAROLINA PAID FAMILY LEAVE INSURANCE ACT.
3 The General Assembly of North Carolina enacts:
4 SECTION 1. Effective January 1, 2022, the General Statutes are amended by adding
5 a new Chapter to read:
6 "Chapter 96A.
7 "Paid Family Leave Insurance Act.
8 "§ 96A-1. Short title; definitions.
9 (a) This Chapter shall be known and may be cited as the "North Carolina Paid Family
10 Leave Insurance Act."
11 (b) The following definitions apply in this Chapter:
12 (1) Application year. – The 12-month period beginning on the first day of the
13 calendar week in which an individual files an application for family and
14 medical leave insurance benefits.
15 (2) Assistant Secretary. – The Assistant Secretary of the Division of Employment
16 Security.
17 (3) Covered individual. – Any person who does all of the following:
18 a. Meets the monetary eligibility criteria set forth in G.S. 96-14.1(b) or
19 is self-employed, elects coverage, and meets the requirements of
20 G.S. 96A-13.
21 b. Meets the administrative requirements outlined in this Chapter and in
22 the rules adopted under this Chapter.
23 c. Submits an application.
24 (4) Covered service member. – Either:
25 a. A member of the Armed Forces, including a member of the National
26 Guard or Reserves, who is (i) undergoing medical treatment,
27 recuperation, or therapy, (ii) otherwise in outpatient status, or (iii) is
28 otherwise on the temporary disability retired list for a serious injury or
29 illness that was incurred by the member in the line of duty on active
30 duty in the Armed Forces or a serious injury or illness that existed
31 before the beginning of the member's active duty and was aggravated
32 by service in the line of duty on active duty in the Armed Forces; or
33 b. A former member of the Armed Forces, including a former member of
34 the National Guard or Reserves, who is undergoing medical treatment,
35 recuperation, or therapy for a serious injury or illness that was incurred
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1 by the member in the line of duty on active duty in the Armed Forces
2 or a serious injury or illness that existed before the beginning of the
3 member's active duty and was aggravated by service in the line of duty
4 on active duty in the Armed Forces and manifested before or after the
5 member was discharged or released from service.
6 (5) Division. – The Division of Employment Security of the Department of
7 Commerce.
8 (6) Employee. – Any individual employed by an employer.
9 (7) Employer. – Any person acting directly or indirectly in the interest of an
10 employer in relation to an employee. As used in this subdivision, "person"
11 means an individual, partnership, association, corporation, business trust,
12 legal representative, or any organized group of persons. For the purposes of
13 this Chapter, it also means the State of North Carolina, any city, town, county,
14 municipality, or any State or local agency or instrumentality of government.
15 The term does not include the government of the United States and any agency
16 of the United States (including the United States Postal Service and Postal
17 Rate Commission).
18 (8) Family and medical leave insurance benefits. – The benefits provided under
19 the terms of this Chapter.
20 (9) Family member. – Any of the following:
21 a. Regardless of age, a biological, adopted, or foster child, stepchild, or
22 legal ward, a child of a domestic partner, a child to whom the employee
23 stands in loco parentis, or a person to whom the employee stood in
24 loco parentis when the person was a minor.
25 b. A biological, adoptive, or foster parent, stepparent, or legal guardian
26 of an employee or an employee's spouse or domestic partner or a
27 person who stood in loco parentis when the employee or the
28 employee's spouse or domestic partner was a minor.
29 c. A person to whom the employee is legally married under the laws of
30 any state or a domestic partner of an employee as registered under the
31 laws of any state or political subdivision.
32 d. A grandparent, grandchild, or sibling (whether a biological, foster,
33 adoptive, or step relationship) of the employee or the employee's
34 spouse or domestic partner.
35 e. Any other individual related by blood or whose close association with
36 the employee is the equivalent of a family relationship.
37 (10) Health care provider. – Any person licensed under federal or North Carolina
38 law to provide medical or emergency services, including, but not limited to,
39 doctors, nurses and emergency room personnel, or certified midwives.
40 (11) Next of kin. – As defined in section 101(17) of the Family and Medical Leave
41 Act, 29 U.S.C. § 2611(17).
42 (12) Qualifying exigency leave. – Leave based on a need arising out of a covered
43 individual's family member's active duty service or notice of an impending
44 call or order to active duty in the Armed Forces, including, but not limited to,
45 providing for the care or other needs of the military member's child or other
46 family member, making financial or legal arrangements for the military
47 member, attending counseling, attending military events or ceremonies,
48 spending time with the military member during a rest and recuperation leave
49 or following return from deployment, or making arrangements following the
50 death of the military member.
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1 (13) Retaliatory personnel action. – Denial of any right guaranteed under this
2 Chapter, including, but not limited to, any threat, discharge, suspension,
3 demotion, reduction of hours, any other adverse action against an employee
4 for the exercise of any right guaranteed herein, or reporting or threatening to
5 report an employee's suspected citizenship or immigration status or the
6 suspected citizenship or immigration status of a family member of the
7 employee to a federal, State, or local agency. Retaliatory personnel actions
8 shall also include interference with or punishment for in any manner
9 participating in or assisting an investigation, proceeding, or hearing under this
10 Chapter.
11 (14) Serious health condition. – An illness, injury, impairment, pregnancy,
12 recovery from childbirth, or physical or mental condition that involves
13 inpatient care in a hospital, hospice, or residential medical care facility, or
14 continuing treatment by a health care provider.
15 (15) State average weekly wage. – The average weekly insured wage as defined in
16 G.S. 96-1(b)(2).
17 "§ 96A-2. Eligibility for benefits.
18 Beginning January 1, 2023, family and medical leave insurance benefits are payable to an
19 individual who:
20 (1) Meets the definition of "covered individual" as defined by G.S. 96A-1(b)(2);
21 and
22 (2) Meets one of the following requirements:
23 a. Because of birth, adoption, or placement through foster care, is caring
24 for a new child during the first year after the birth, adoption, or
25 placement of that child;
26 b. Is caring for a family member with a serious health condition;
27 c. Has a serious health condition;
28 d. Is caring for a covered service member who is the covered individual's
29 next of kin or other family member; or
30 e. Because of any "qualifying exigency leave" arising out of the fact that
31 the family member of the covered individual is on active duty (or has
32 been notified of an impending call or order to active duty) in the
33 Armed Forces.
34 "§ 96A-3. Duration of benefits.
35 (a) The maximum number of weeks during which family and medical leave insurance
36 benefits are payable under G.S. 96A-2(a)(2)c. in an application year is 18 weeks.
37 (b) The maximum number of weeks during which family and medical leave insurance
38 benefits are payable under G.S. 96A-2(a)(2)a., (2)b., or (2)e. in an application year is 12 weeks.
39 (c) The maximum number of weeks during which family and medical leave insurance
40 benefits are payable under G.S. 96A-2(a)(2)d. in an application year is 26 weeks.
41 (d) The first payment of benefits must be made to an individual within two weeks after
42 the claim is filed, and subsequent payments must be made every two weeks thereafter.
43 "§ 96A-4. Amount of benefits.
44 (a) The amount of family and medical leave insurance benefits shall be determined as
45 follows:
46 (1) The weekly benefit shall be determined as follows: (i) the portion of the
47 covered individual's average weekly wage that is equal to or less than one
48 hundred percent (100%) of the State average weekly wage shall be replaced
49 at a rate of ninety percent (90%) and (ii) the portion of an employee's or
50 self-employed individual's average weekly wage that is more than one
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1 hundred percent (100%) of the State average weekly wage shall be replaced
2 at a rate of fifty percent (50%).
3 (2) The maximum benefit shall be one hundred percent (100%) of the statewide
4 average weekly wage.
5 (3) The minimum weekly benefit shall not be less than one hundred dollars
6 ($100.00) per week except that if the covered individual's average weekly
7 wage is less than one hundred dollars ($100.00) per week, the weekly benefit
8 shall be the employee's full wage.
9 (4) For purposes of this section, a covered individual's average weekly wage shall
10 be the average weekly wage during the 12 months preceding submission of
11 the application (or the average weekly wage during the time the covered
12 individual worked, if it was less than 12 months).
13 (b) Family and medical leave insurance benefits are not payable for less than eight hours
14 of family and medical leave taken in one workweek.
15 "§ 96A-5. Contributions.
16 (a) Payroll contributions shall be authorized in order to finance the payment of benefits
17 under the family and medical leave insurance program.
18 (b) Beginning on January 1, 2022, for each employee, an employer shall remit to the Paid
19 Family and Medical Leave Fund (Fund), established under G.S. 96A-16, contributions in the
20 form and manner determined by the Division. Annually, not later than October 1, the Assistant
21 Secretary shall fix the contribution rate for the coming calendar year in the manner described in
22 this subsection. For calendar years 2022 and 2023, the Assistant Secretary shall do so based on
23 sound actuarial principles. For calendar year 2024 and thereafter, the Assistant Secretary shall
24 first certify and publish the following information:
25 (1) The total amount of family and medical leave insurance benefits paid by the
26 Division during the previous fiscal year;
27 (2) The total amount remaining in the Fund at the close of the fiscal year;
28 (3) The total amount equal to one hundred forty percent (140%) of the previous
29 fiscal year's expenditure for family and medical leave insurance benefits paid
30 and for the administration of the family and medical leave insurance program;
31 (4) The amount by which the total amount remaining in the Fund at the close of
32 the previous fiscal year is less than or greater than one hundred forty percent
33 (140%) of the previous fiscal year's expenditure for family and medical leave
34 insurance benefits paid and for the administration of the family and medical
35 leave insurance program; and
36 (5) The amount by which the contribution rate shall be adjusted to ensure that the
37 Fund shall maintain or achieve an annualized amount of not less than one
38 hundred forty percent (140%) of the previous fiscal year's expenditure for
39 family and medical leave insurance benefits paid and for the administration of
40 the family and medical leave insurance program. The contribution rate
41 adjustment, if any, made as the result of the Assistant Secretary's certification
42 and report under this subsection shall supersede the rate previously set forth
43 and shall become effective on January 1 of the following calendar year.
44 (c) A self-employed individual who is electing coverage under G.S. 96A-13 shall be
45 responsible for the employee's share of contributions set forth in subsection (b) of this section on
46 that individual's income from self-employment.
47 (d) An employer shall not deduct more than fifty percent (50%) of the contribution
48 required for an employee by subsection (b) of this section from that employee's wages and shall
49 remit the full contribution required under said subsection to the fund.
50 "§ 96A-6. Reduced leave schedule.
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1 (a) A covered individual shall be entitled, at the option of the covered individual, to take
2 paid family and medical leave on an intermittent or reduced leave schedule in which all of the
3 leave authorized under this Chapter is not taken sequentially. Family and medical leave insurance
4 benefits for intermittent or reduced leave schedules shall be prorated.
5 (b) The covered individual shall make a reasonable effort to schedule paid family and
6 medical leave under this section so as not to unduly disrupt the operations of the employer. The
7 covered individual shall provide the employer with prior notice of the schedule on which the
8 covered individual will take the leave, to the extent practicable. Paid family and medical leave
9 taken under this section shall not result in a reduction of the total amount of leave to which an
10 employee is entitled beyond the amount of leave actually taken.
11 (c) Nothing in this section shall be construed to entitle a covered individual to more leave
12 than required under G.S. 96A-3.
13 "§ 96A-7. Leave and employment protection.
14 (a) Any covered individual who exercises his or her right to family and medical leave
15 insurance benefits shall, upon the e