NY Employee Disability Benefits What You Need To Know
New York State requires employers to provide disability benefits for their eligible employees. Also known as The New York State Mandatory Disability Insurance Program, it requires employers who operate a business in New York and have at least one employee on payroll to provide short term disability coverage. The coverage can be purchased from an authorized private insurance carrier, directly from the state or by self-insuring.
New York’s Mandatory Disability Program provides partial income replacement for up to 26 weeks to employees who are temporarily unable to work due to a disability resulting from non-work related injury or illness. Pregnancy and childbirth are also covered under the law.
Is My Business Required to Provide Employee Disability Benefits?
- If you employ at least one employee who has worked a minimum of 30 days in a calendar year, you are required to offer disability benefits. (The 30 days do not need to be consecutive.)
- If the employee has worked 30 days, you must provide disability coverage within four weeks.
- If you employ domestic or personal employees (including in a private home) and those employees work at least 40 hours a week for the same employer.
- If you purchased a New York business with existing eligible employees
Note: An employer may elect to provide coverage, even if not required. Voluntary coverage can be obtained by filing a Voluntary Coverage Application.
How Does The NY Employer Disability Benefits Program Work?
An employee is eligible to receive benefits if he or she suffers an off-the-job illness, injury or disability, including pregnancy. The insurance payments do not cover employee hospital bills, medical expenses or rehabilitation.
Benefits are paid weekly to the employee and are equal to 50% of the employee’s average weekly salary based on the last 4 weeks prior to the disability. Benefits become payable on the 8th consecutive day of disability and continue for up to 26 weeks.
The maximum weekly benefit is $170.00 and the maximum benefit period is for 26 weeks during a 52 consecutive week period. Benefits are partially taxable and the taxable amount depends on the contribution percentage of the employer and the employee.
How Much Do I Have To Pay For Employer Disability Benefits?
Mandatory Disability Insurance rates vary from each New York State authorized insurance carrier, so it is best to shop around. Rates are charged per each covered male and female employee. Premiums can be paid annually in advance or quarterly in arrears.
Employers may collect a salary deduction from employees to help fund their insurance obligation. The employee contribution rate is 0.5% of the first $120.00 of weekly wage and not to exceed $.60 per week or $31.20 per year. The employer funds the remainder of plan cost. Employers do not have to require employee contributions.
New York is among one of the few states that requires employer disability benefits. Other states that require disability benefits are: California, Hawaii, New Jersey, Rhode Island and Puerto Rico.
For more information or if you would like a custom quote for your business, please call: 800-514-3513