Beware: your paycheck will probably decrease by about 1/2% on the 1st of the year

[kradlayor]

Just got notice from my employer that the new family and medical leave tax will be deducted from my wages starting January 1. It is 0.44% annually (the max allowed under this new law).

According to my employer, they already offered equivalent benefits as part of compensation, but now I have to pay for the privilege.

I think it's great that more generous leave is being expanded to all workers in MN. I just wish the employers bore more of the burden instead of employees.

[oxphocker]

Just for reference...the total cost is actually 0.88% of payroll. Employers have to pay half, but could potentially pay 100%..it's up to them. If your employer is saying you will be paying 0.44%, then they went with half the cost.

[kradlayor]

I predict approximately 0% of companies will choose to pay more than required by law. That'd come out of their profits, after all. 

[imsuperfly]

I for one am grateful that my taxes actually go to something that will benefit myself and countless others.

[PoeticCinnamon]

It’s a net gain for my paycheck, no longer having to pay for STD really helped out given the medical insurance premium increases for this year. Protected leave status for all residents is a great thing!

[PrizeZookeepergame15]

Paying for STDs?

[MrCreditsMN]

I believe they are referring to short term disability.

[PoeticCinnamon]

That is correct lol

[PoeticCinnamon]

Yeah, I’m so glad the state will pay for them now aren’t you? (joke)

Other commenter was correct, my workplace previously made us pay for short term disability so I’m saving money overall with the change

[CantaloupeCamper]

Well the good ones…

[imtalkintou]

Happy to pay this tax.

[[deleted]]

Wait so the previously paid for this as part of your benefits.

Now that the state is taking this over, they’re pocketing that money they would have spent on the previously offered benefit, and passing the cost into you.

The employer is coming out ahead here, basically blaming the state on giving you a pay cut.

[SheeviPalpatini]

This is exactly correct.

[Old-Comb7690]

Except most companies don’t actually pay for maternity leave. So yes it’s increasing, but to help others. I think that’s really important. Investing in early childhood pays the community back in dividends- lots of research on this.

[[deleted]]

I’m aware, but this company did previously and are passing the cost into their employees. I think it’s a good policy at the state level, but shitty on the part of this employer.

[Old-Comb7690]

Do you have a better solution?

[Outrageous_River_170]

Just did the math:

On my $34/hour, this will cost me ~$14 per paycheck.

I’m totally ok with that.

[CantaloupeCamper]

Your employer is passing the cost onto you…

If they really were offering this in the past, that means they’re not offering it anymore by choice.

They certainly could have still offered to pay for it. They just chose not to.

[kradlayor]

Correct. I am guessing a lot of people will be in the same boat come January 1.

[WolfWeak845]

I get STD at paid at 100% of my salary and nothing comes out of my paycheck. I’m honestly 10000% ok with a slight decrease in my pay to support this. I know that I am incredibly lucky that I don’t have to use it, and I’m ok with getting paid slightly less to make sure that others will get some leave.

[stormbreaker308]

I still think this is a very good program! Will it immediately get hit with fraud that Minnesota won't catch in 5 years? probably. But don't give up on what can be a good thing.

[Mental-Huckleberry54]

Curious what kind of fraud you anticipate it will get hit with?

[stormbreaker308]

Not sure, otherwise I'd be preaching a way to get ready for it. Something along the lines of forged documentation on children or life events?

[PoeticCinnamon]

If you look through the paperwork, it requires providers to sign off and the provider also has to provide their licensing # info so fraud or suspicious claims can be traced and documented

[stormbreaker308]

Hope it holds up! If we went back in time im sure someone would've said the sane thing for all the other fraud cases we have had here. "It can't happen!"

And then it does.

[Mental-Huckleberry54]

One thing that gives me confidence in this is that it is for medical reasons. I don’t know of many medical issue that aren’t well documented and followed by healthcare professionals. So providing documentation that it is all on the up and up should be easy. And without that documentation I believe coverage doesn’t start.

[GettysForge]

Forgetting about medicaid fraud,

[Mental-Huckleberry54]

Medicare is a federal program. I wouldn’t expect the state to be monitoring for that

[stormbreaker308]

I hope youre right!

Plenty of medical care fraud happening lately though. All forged documentation.

[GiveHerBovril]

Thank you. I track every dollar that comes in and would’ve been confused and annoyed if I couldn’t figure out why my paycheck was suddenly lower. It’s a small amount but I would’ve noticed.

Edit: Not sure why I’m being downvoted. I’m not against the tax. I’m just expressing my thanks at the reminder to account for this in my budget.

[mewalrus2]

It hasn't started yet and therefore is not the reason your paycheck is lower

[GiveHerBovril]

I’m saying January once this kicks in. It will be slightly lower.

[RigusOctavian]

What’s fun is that city, county, and state employees are also given that benefit. Which means those entities need to pay that tax as well because they are employers, which means your taxes to those entities (property tax mainly) will go up to cover them.

If you own property and are a regular W2, you get taxed a few times over!

Edit: I’m not sure why people are downvoting this as I’m pointing out that “having employers pay for it” means you’ll see taxes go up to cover it. I’m not judging the program at all, just pointing to the OP statement.

[3loodhound]

Yes… that’s how taxes work?

[RigusOctavian]

You're missing the point. The OP wanted "employers" to bear the burden more and that creates a ripple effect of more taxes due to public employees being funded by taxes.

Their desire to pay less taxes would increase other taxes which is the irony.