New Jersey Family Leave Insurance

The New Jersey Paid Family Leave program is the state’s implementation of family medical leave insurance (FMLI). It provides employees paid time off to care for themselves or a family member.

This tax consists of the Family Leave Insurance Employee component.

Before you implement New Jersey FMLI, there are some issues you need to consider.

• What are the employee eligibility criteria

• How to override the legislative rates and percentages

• How to opt out your organization

• How to exclude individual employees

• How to cost the tax

• What wage basis rules it follows

For further info, see the following sections.

What is the employee eligibility criteria

To be eligible for the New Jersey FMLI tax, an employee must have:

1. Have a valid tax card with a tax reporting unit (TRU) association

2. New Jersey identified as one of the following

   • Family leave insurance (FLI) state on the person's Tax Jurisdictions card

   • State unemployment insurance (SUI) state on their Tax Withholding card (if FLI state is undefined)

How to override the legislative rates and percentages

To override the legislative tax rates and percentage distribution between employee and employer components:

1. To override at the payroll statutory unit (PSU) level, start the Legal Entity Calculation Cards task from your implementation project.

   To override at the TRU level, start the Legal Reporting Unit Calculation Cards task.

   Settings at the TRU level override those at the PSU level.

2. Open the calculation card for editing.

3. In Component Groups, click New Jersey.

   Create it if it doesn't exist.

4. In Calculation Components, select State FLI.

   Create it if it doesn't exist.

5. Select Enterable Calculation Values on Calculation Cards.

6. Click Create.

7. To change the total tax rate, search for and select FLI combined rate.

   To override the distribution between the employee and employer rates, use FLI employee percentage and FLI employer percentage. Enter these values as percentages. For example, enter 50% as 50. The sum of these percentages must equal 100%.

8. Save your work.

How to opt out your organization

To opt out an entire organization:

1. To opt out at the PSU level, start the Legal Entity Calculation Cards task from your implementation project.

   To opt out at the TRU level, start the Legal Reporting Unit Calculation Cards task.

2. Open the calculation card for editing.

3. In Component Groups, click New Jersey.

4. In Calculation Components, select State Disability.

5. Select Enterable Calculation Values on the Calculation Card.

6. Click Create.

7. Search for and select FLI employee tax exemption.

8. In Value, enter select the appropriate exemption status.

9. Save your work.

How to exclude individual employees

To exclude individual employees from this tax:

1. Open the person's tax card for editing.

2. Open the New Jersey component for editing.

3. Search for the person, and open their Tax Withholding card for editing.

4. In Withholding Exemption, select the appropriate exemption for Family Leave.

5. Save your work.

How to cost the tax

To process FLI taxes, cost these predefined elements using the FLI Tax Calculated input value.

• Family Leave Insurance Employee Tax

• Family Leave Insurance Employee Tax Not Taken

What wage basis rules it follows

When configuring the wage basis rules for New Jersey FMLI, find them under State FLI in the Component Group Rules task.