California Governor’s Executive Order on Disaster Unemployment Assistance for Child Care Providers in Los Angeles
On February 11, 2025, Governor Gavin Newsom issued an executive order to support childcare providers impacted by the recent wildfires in Los Angeles. This order ensures that those affected are aware of their eligibility for Disaster Unemployment Assistance (DUA) and receive the necessary support to apply.
In addition to supporting individual workers, the EDD offers several disaster-related services to employers affected by emergencies. These services are designed to provide financial relief and support business continuity during challenging times.
Employers directly impacted by a disaster can request up to a two-month extension to file their state payroll reports and deposit payroll taxes without penalty or interest.
The EDD collaborates with Local Assistance Centers and Disaster Recovery Centers established by the California Governor’s Office of Emergency Services (Cal OES) or federal authorities to provide comprehensive support to affected businesses.
Employers can also access information about Disability Insurance (DI) and Paid Family Leave (PFL) benefits for their eligible workers, ensuring that employees who are unable to work due to disaster-related reasons receive the necessary financial support.
The Dollars and Cents of Separation and Divorce: Understanding Post-Separation Support and Alimony in North Carolina
Before we dive into ways to prepare for your post-separation support and alimony case, it’s important to understand what these terms mean and your general eligibility for spousal support.
There are two types of spousal support in North Carolina:
Post‑separation support (PSS) is temporary financial support paid after separation and while an alimony claim is pending. If the parties are unable to agree on an amount of PSS or the supporting spouse refuses to provide financial support to the spouse in need, a spouse who needs financial support from the other spouse must request PSS from the Court. Typically, PSS continues until the parties reach an agreed upon resolution of the alimony claim or the Court rules on the spouse’s alimony claim. If the parties are unable to agree on an appropriate PSS award (typically a fixed amount paid monthly), the Court may award PSS based solely on the parties’ respective financial affidavits, discussed in more below, or the Court may conduct a hearing (review financial documents and take testimony from witnesses) before making a decision on PSS.
Alimony is financial support that continues for a period of months or years into the future. If the parties are unable to reach an agreement regarding an alimony claim, the Court will consider relevant testimony and other evidence in the context of an alimony hearing. If the North Carolina court is asked to make a decision on equitable distribution (i.e., property division) and alimony, it is not uncommon for the Court to first rule on equitable distribution issues and then make a decision on the alimony claim.
Who is eligible for Post-Separation Support and Alimony in North Carolina?
To be eligible for PSS and/or alimony, the spouse seeking PSS or alimony must show that they are a “dependent spouse” and that the other spouse is a “supporting spouse.”
A “dependent spouse” is a spouse who is currently unable to financially meet his or her own needs without the support of the other spouse or will be unable to maintain his or her accustomed standard of living, established prior to the date of separation, without financial contribution from the other spouse.
A “supporting spouse” is a spouse from whom a dependent spouse was relying upon to meet their needs during the marriage or is in need of support to currently meet their needs.
How will marital misconduct impact spousal support?
We cannot discuss your eligibility for spousal support without mentioning “illicit sexual behavior.” Committing “illicit sexual behavior” with a third party during the marriage and before the date of separation will have significant implications on your alimony case. On the other hand, for post-separation support, a court is able to use its discretion to determine whether to award PSS. Illicit sexual behavior includes almost every sexual act you can think of.
If a dependent spouse has committed acts of “illicit sexual behavior” during the marriage and prior to the date of separation, and the supporting spouse has not, then the dependent spouse is completely barred from receiving alimony.
If the supporting spouse has committed illicit sexual behavior, but the dependent spouse has not, then the court must require the supporting spouse to pay some amount of alimony.
If both spouses have committed illicit sexual behavior, then the Court can award alimony at its discretion.
There are other acts of marital misconduct, as that term is defined in N.C. Gen. Stat. 50-16.1A that can have an impact on your spousal support case, but none have the same mandatory implications as illicit sexual behavior.
With this basic understanding of PSS and alimony, let’s review several steps you can take to prepare for your post-separation support and alimony case.
Set reasonable expectations.
The amount and duration of PSS and alimony awarded in a case depends on various factors. The main factors are (1) the standard of living enjoyed by the parties on the date of separation, and (2) the length of the marriage.
We look at the lifestyle the parties enjoyed during the marriage – the neighborhoods they lived in, the vacations they took, savings and investment habits, etc. While the court will look to your standard of living established prior to the date of separation to determine an appropriate amount of spousal support, the Court must still find that the supporting spouse has the ability to pay the amount of spousal support requested by the dependent spouse. Generally, after the date of separation, a supporting spouse still earns the same amount of money as he or she did during the marriage, but you are now living in two separate households and with two separate sets of expenses.
The concept of supporting two households on the same income presents a unique dilemma for the litigants and the court. Except in cases involving very high-income spouses, it is impossible for a court to maintain, after separation, an identical standard of living to what was enjoyed during the marriage. The money must exist to provide for both households.
A supporting spouse must also set reasonable expectations, including how much a dependent spouse is actually able to earn immediately after separation and in the coming years. For example, a stay-at-home parent may need some time and job training to re-enter the workforce. In some jurisdictions, a court may find that a spouse who has been out of the workforce for twenty years doesn’t have the ability to earn income sufficient to support themselves, depending on their age.
We also look to the length of the marriage to assist us in determining an appropriate duration for the payment of spousal support. Generally speaking, the longer the marriage, the longer the period of alimony payments. Short-term marriages (lasting under five years) usually see the shortest duration of alimony payments.
Consider your court.
Setting reasonable expectations also means considering typical support orders rendered in your geographic region.
While the law remains the same throughout North Carolina, ultimately, the amount of spousal support awarded by a court, if any, is discretionary and varies between judges and districts.
Unlike for child support, there is no calculator or formula used to determine your potential post-separation support or alimony award, thus consultation with an experienced family law attorney is helpful in determining the amount of support that may be awarded.
Prepare a financial affidavit.
Regardless of whether you are a dependent or supporting spouse, your attorney will likely ask you to fill out a financial affidavit detailing your income and expenses (including expenses for minor children). A financial affidavit is basically a budget that will be used to determine your need for PSS and alimony or your ability to pay.
It is important to be as accurate as possible and capture all of your expenses by reviewing past bills, bank statements, credit card statements, and cash spending. Expenses such as utilities and food should be averaged over a period of time, usually one to three years, depending on the circumstances of your case.
Your financial affidavit should also include savings and investment contributions if you customarily contributed to these accounts during the marriage. The financial affidavit is not a wish list, but it should include all of your current and customary expenses.
It is equally important to notify your attorney of any expenses that you may incur in the future but that are currently covered by your spouse or a third party. Examples may include the imminent need for a vehicle, your own health insurance policy, or a place to live if you are temporarily living with a relative (including all expenses associated with maintaining separate housing). Financial affidavits vary by county and judicial district.
Seek employment, job training, or education.
Depending on your age, education, employment history throughout your life and during the marriage, and the ages of any minor children, a court may determine that you have the ability to be gainfully employed, and the court may expect you to seek employment.
For those who are able-bodied, working age, and capable of being employed, start inquiring into any necessary job training or educational programs that may help you secure gainful employment, including the cost of these programs, and discuss these options with your attorney.
With some exceptions, it is usually advisable to secure some sort of employment as soon as possible, as a court may impute income to a spouse if the court finds that a spouse is earning below their earning capacity in bad faith or in disregard of their duty to self-support. “Imputing income” is the court’s process of assigning income to you based on your earning potential, regardless of the amount you are actually earning. This is determined on a case-by-case basis and should be discussed with your attorney prior to taking action.
Maintain current earnings if employed.
When a supporting or dependent spouse attempts to change careers, deliberately fails to apply himself or herself to his or her business or employment, or intentionally depresses his or her income in an effort to avoid paying spousal support, a court may impute income to that spouse.
Any career change or employment change should be discussed with your attorney in advance. You should also be prepared to defend any decrease in your income occurring near or subsequent to the date of separation. This isn’t to say that you cannot change jobs or start a business during a divorce, but it is advisable to discuss life changes that will result in a change in your income with your attorney.
Seek support when necessary.
Many of our clients come to us with little experience managing finances and investments. In some cases, you may want to consider hiring a financial planner or a Certified Divorce Financial Analyst (CDFA) to help you with short and long-term financial planning, to help you with investment strategies, and tax consequences and tailor a financial plan to help you maintain and preserve your portion of the marital estate that will be distributed to you in the divorce process.
Corporate Transparency Act Reporting Obligations Effective Again With March 21, 2025, Deadline for Most Reporting Companies
On February 17, 2025, the US District Court for the Eastern District of Texas (EDTX) in Smith, et. al. v. US Department of the Treasury, et. al., entered an order staying the nationwide injunction on enforcement of the Corporate Transparency Act (CTA). With this ruling, the beneficial ownership information (BOI) reporting requirements promulgated under the CTA are back in effect.
In light of this court action, the Financial Crimes Enforcement Network (FinCEN) announced that, for most reporting companies, the new deadline to file an initial, updated, and/or corrected BOI report is now March 21, 2025. In its announcement, FinCEN noted that this new filing deadline may be subject to further modification, however, for now, existing reporting companies should begin preparations to file their required BOI reports by March 21, 2025.
Planning for Compliance
FinCEN’s new deadline of March 21, 2025 applies to all non-exempt reporting companies formed on or before February 19, 2025. Going forward, non-exempt reporting companies formed after February 19, 2025 will have 30 days from their formation to file their BOI reports.
Reporting companies should continue to closely follow developments related to the CTA. Specifically, note that Congress is considering a bill to extend the reporting deadline to January 1, 2026, but only for reporting companies in existence before January 1, 2024. Furthermore, in its announcement, FinCEN gave itself leeway to “assess its options to further modify deadlines.”
Recent Events in CTA Litigation
The EDTX’s February 17 order was based on the US Supreme Court’s order in McHenry v. Texas Top Cop Shop, Inc. issued January 23, 2025, which stayed a similar nationwide injunction issued in a different proceeding pending in the EDTX.
Below is a recap of CTA litigation developments leading up to this February 17 order:
On December 3, 2024, in Texas Top Cop Shop, Inc., et al. v. Garland, et al., a judge in the EDTX issued a nationwide preliminary injunction halting enforcement of the CTA and its implementing regulations.
On December 23, 2024, a motions panel of the US Court of Appeals for the Fifth Circuit granted an emergency motion for a temporary stay of that preliminary injunction, effectively reinstating the original filing deadlines for reporting companies under the CTA.
On December 26, 2024, a merits panel of the Fifth Circuit vacated the motions-panel stay that was issued on December 23, resulting in another pause on the CTA’s BOI reporting requirements.
On January 7, 2025, a different judge in the EDTX issued an order in the Smith v. U.S. Department of the Treasury case, imposing a separate nationwide injunction on CTA’s enforcement.
Following the Fifth Circuit’s December 26 order pausing the CTA’s BOI reporting requirements, the US Department of Justice (DOJ) filed with the Supreme Court seeking a stay of the nationwide injunction against the enforcement of the CTA issued in the Texas Top Cop Shop case, which the Supreme Court granted on January 23, 2025. However, the Supreme Court did not address the separate nationwide injunction that was issued in Smith, which meant that, until now, the enforcement of the CTA remained on hold.
On February 5, 2025, the US Department of Justice (DOJ) (on behalf of the US Treasury Department) appealed the EDTX’s January 7 order in the Smith, and concurrently filed a motion to stay the injunction pending the outcome of the appeal to the Fifth Circuit in light of the stay ordered by the Supreme Court on January 23, 2025.
As noted above, on February 17, 2025, the EDTX in Smith stayed its own January 7, 2025 order, pending appeal. Given this decision, FinCEN’s regulations implementing the BOI reporting requirements of the CTA are no longer stayed.
Maryland DOL Seeks to Delay Paid Family and Medical Leave Insurance Program
Enacted in 2022, the Maryland Family and Medical Leave Insurance (FAMLI) program covers all employers with Maryland employees and will eventually provide most of those employees with up to twelve weeks of paid family and medical leave, with the possibility of an additional twelve weeks of paid parental leave.
Following several prior delays, employee contributions were scheduled to begin on July 1, 2025, with benefits commencing one year later on July 1, 2026. However, the Maryland Department of Labor (Maryland DOL) is now proposing a delay until January 1, 2027, for deductions and January 1, 2028, for benefits, based on the need to focus on supporting Maryland businesses and their employees in light of the significant uncertainty arising from President Donald Trump’s many employment-related executive orders.
Quick Hits
Due to concerns about readiness and cost, the Maryland DOL is proposing to delay the start of employee contributions to the Maryland FAMLI program to January 1, 2027, and the commencement of benefits to January 1, 2028.
The FAMLI program, enacted in 2022, aims to provide up to twelve weeks of paid family and medical leave for most Maryland employees, with the potential for an additional twelve weeks of paid parental leave.
A state senator has introduced a bill to delay the FAMLI program’s effective dates, highlighting the business community’s concerns over the lack of final regulations and the program’s significant economic impact.
Where Are the Regulations Now?
The Maryland DOL’s FAMLI Division was directed to issue regulations to implement the FAMLI program. As we previously noted in our multipart series on the FAMLI program, the Maryland DOL has engaged in an unusually extended and inclusive rulemaking process, likely impacted by amendments and delays to the program that were enacted in each of the 2023 and 2024 Maryland General Assembly sessions. At this point, the Maryland DOL has issued two sets of proposed regulations, which we covered in Part II (General Provisions, Contributions, and Equivalent Private Insurance Plans) and Part III (Claims and Dispute Resolution) of our series. But other sections of the proposed regulations, including Enforcement, have yet to be issued.
Concerns About Implementation and a Proposed Delay
There have been significant concerns about the Maryland DOL’s readiness to implement this complex program, as well as its overall cost (approximately $1.6 billion) in the current economic climate. In fact, Maryland state Senator Stephen Hershey has proposed a bill, Senate Bill (SB) 355, that seeks to delay the effective contribution and benefits dates by two years. In a hearing on this bill before the Senate Finance Committee on February 5, 2025, Fiona W. Ong (the author of this article) testified about the business community’s concern that final regulations—and even entire sections of the proposed regulations—have yet to be issued only months before the first deadlines. For example, employers are supposed to begin filing a declaration of intent (DOI) to have an equivalent private insurance plan (EPIP) starting on May 1, 2025. But at this point, employers do not have final rules about creating a self-insured plan, and insurance companies do not have final rules on creating commercial plans (which would also need to be compliant with insurance laws and regulations).
The Maryland DOL acknowledges that legislative action is required to authorize the delay and, in its press release, states that it is working closely with leadership in the General Assembly to extend the implementation dates. It is unclear whether the General Assembly will use Senator Hershey’s bill or issue a new bill. But given the Maryland DOL’s public statements, it is almost certain that the delay will take place.
This is obviously a significant development for employers with Maryland employees, many of whom are concerned about the cost and impact of this program in which the state, and not the employer, grants the paid leave benefit.
Navigating New DOL Opinion Letters: Implications for Tip Pooling and Coordinating Paid Family Leave Benefits With FMLA Leave
On January 14, the US Department of Labor’s (DOL) Wage and Hour Division (WHD) published two opinion letters, FLSA2025-1, which addresses tip pooling under the Fair Labor Standards Act (FLSA), and FMLA2025-1-A, which provides guidance on how employers may coordinate paid family leave benefits with leave taken under the Family Medical Leave Act (FMLA).
FLSA2025-1: The Tip Pooling Letter
In restaurants and other service-based establishments, customer tips are often collected and pooled for employees to share. It is well understood that employees working in a management capacity cannot share in tip pools under the FLSA. FLSA2025-1 focuses on whether managers and supervisors can lawfully share in tips when they work in a non-management capacity. The following two scenarios were discussed in the letter:
Can a Team Lead or Assistant Team Lead who is a manager for purposes of the FLSA, but who clocks in and works a shift in a non-management capacity, participate in a tip pool for that particular shift?
Can a Shift Lead, who is not a manager for purposes of the FLSA, but who is the highest-ranking employee during a particular shift, participate in a tip pool during that shift?
Regarding Team Leads and Assistant Team Leads, the WHD determined that, if the manager in question qualifies as an exempt executive employee and, therefore, is primarily engaged in exempt-level duties, then they may not receive any tips from a tip pool. To permit an individual whose primary duty is management (based on their job as a whole) to receive tips from a tip pool simply because the employee happened to engage in non-management duties on a particular shift would circumvent the FLSA’s general prohibition against allowing managers to draw from employee tip pools.
However, the WHD found that if the Shift Leads in question do not qualify as exempt executive employees, then they may share in a tip pool, even on those shifts when they are the most senior employee working at the establishment. Unlike an exempt Team Lead or Assistant Team Lead, their primary duty is not management-level work. As such, allowing a non-exempt Shift Lead to share in a tip pool would not circumvent the goals of the FLSA.
The key takeaway from FLSA2025-1 is that employers should remain extremely cautious when it comes to allowing management-level employees to share in tip pools. If those employees qualify as exempt for overtime purposes, they should not be permitted to share tips even when they perform non-exempt tasks.
FMLA2025-1-A: Coordination of FMLA and Paid Family Leave Benefits
The second opinion letter, FMLA2025-1-A, focuses on the coordination of benefits employees receive from paid family leave programs with protected leaves of absence under the FMLA. A growing number of state and local governments have implemented paid family leave benefits where employees receive paid time off (PTO) for reasons such as personal medical issues, family care, and parental bonding. These plans vary widely in their scope and the duration of benefits they provide.
Under the FMLA, if an employee’s protected leave is unpaid, the employer may require the employee to use any accrued vacation, PTO, or sick time the employee may have. However, the rule has long been that, if the employee’s protected FMLA leave is paid through workers compensation or disability benefits, then the employer may not require the employee to use any of their accrued vacation, PTO, or sick time.
In FMLA2025-1-A, the WHD decided that employers are likewise prohibited from requiring employees to use accrued vacation, PTO, and sick time if they are on a protected FMLA leave while receiving compensation from a paid family leave program. For example, if the employee is on a 12-week FMLA leave and the first four weeks are paid through a state-law family leave program, the employer cannot require the employee to use their vacation/PTO/sick hours (although the employee and the employer may voluntarily agree to such an arrangement). However, for the last eight weeks of the FMLA leave, which are unpaid through the state benefits program, the employer can require the employee to use their accrued time off hours.
With the ever-expanding number of both paid and unpaid employee leave programs under state and local laws, it is important to stay abreast of how those rights interact with the rights under the FMLA. FMLA2025-1-A highlights when employers may lawfully require employees to use their accrued vacation, PTO, and sick hours, an issue that regularly causes confusion for many human resources and payroll professionals. It is thus an appreciated piece of guidance.
Aging Answers: Solo Senior Planning [Podcast]
Certified Elder Law Attorney Shana Siegel breaks down key steps for solo senior planning, from long-term care to protecting your independence. Joining her is Elder Care Strategist Adrian Allotey, founder of You Are Not Alone Elder Care, LLC, who shares real-life stories and practical advice.
FTC Announces Updates to COPPA Rule
On January 16, 2025, the Federal Trade Commission (FTC) issued a press release stating, “The updated [Children’s Online Privacy Protection Act (COPPA)] rule strengthens key protections for kids’ privacy online. By requiring parents to opt [into] targeted advertising practices, this final rule prohibits platforms and service providers from sharing and monetizing children’s data without active permission. The FTC is using all its tools to keep kids safe online.”
These changes are the first major updates to the rule since its inception in 2013. COPPA protects the online privacy of children under the age of 13. It imposes specific requirements on operators of websites or online services directed to children or that knowingly collect personal information from children. COPPA requires operators to obtain verifiable parental consent before collecting, using, or disclosing personal information from children under 13 and to provide clear and comprehensive notice of their information practices regarding children, including a link to their children’s privacy policy on their website or online service. The rule also requires operators to take reasonable steps to disclose children’s personal information only to third parties capable of maintaining its confidentiality, security, and integrity. COPPA also mandates that operators retain collected children’s personal information for only as long as necessary to fulfill the purpose of its collection and delete such information using reasonable measures to protect against unauthorized access or use.
COPPA also includes provisions related to the FTC’s ability to approve self-regulatory guidelines (known as Safe Harbor Programs), which allow operators to use alternative methods for obtaining parental consent, provided they meet the requirements of COPPA.
The amendments to the COPPA rule include:
An Expanded Definition of Personal Information: Now includes biometric and government-issued identifiers.
A New Definition of Mixed Audience Website or Online Service: These are websites or services directed to children, but do not target them as the primary audience and do not collect personal information from any visitor before determining if the visitor is a child.
Required Parental Consent for Data Disclosure: Operators must now obtain separate verifiable parental consent for disclosing a child’s personal information to third parties, such as for targeted advertising purposes.
New Methods for Verifiable Parental Consent: Expands the permissible methods, including knowledge-based authentications, submitting government-issued photographic identification, and using text messages with additional safeguards.
A Required Information Security Program: Operators are required to establish and maintain a written information security program appropriate to the sensitivity of the personal information collected from children. This program must be regularly tested and monitored.
Strengthened Data Retention Limitations: Operators must retain children’s personal information for only as long as necessary to fulfill a specific purpose and must maintain a publicly available written data retention policy.
More Accountability for Safe Harbor Programs: Comprehensive reviews of the operator’s privacy and security policies now required.
The FTC did not adopt proposed amendments to the rule related to limitations on using push notifications to children without parental consent or requirements for educational technology in schools. The changes to the rule will take effect 60 days after publication in the Federal Register (which has not yet occurred or been scheduled). Organizations subject to the final rule have one year to comply with the changes; however, compliance is required earlier in relation to COPPA Safe Harbor programs. To review the amendments, click here.
Video Game Maker to Pay $20 Million to Settle FTC COPPA Enforcement Action
Singapore-based Chinese video game developer Cognosphere, dba HoYoverse, known for “Genshin Impact,” a role-playing game involving collectible characters with unique fighting skills, has agreed to pay $20 million to settle Federal Trade Commission (FTC) allegations that it violated the Children’s Online Privacy Protection Act (COPPA) and deceived players about the cost of winning certain prizes.
Introduced in the U.S. in 2020, Genshin Impact was one of the first Chinese video games to go viral in this country.
The FTC alleged that the company collected children’s personal information without parental consent as required by COPPA. The FTC’s complaint stated that the company “shares device-related persistent identifier information and records of the player’s engagement, progress, and spending within the game with third-party analytics and advertising providers.”
Additionally, the game’s players pay real money for a virtual currency for the chance to win virtual prizes; however, the opportunities to win prizes are confusing and complicated and involve multiple types of in-game virtual currency with different exchange rates. The purchasing process obscures the reality that consumers must spend large amounts of real money to obtain 5-star heroes. As a result of the settlement, the company will introduce new age-gate and parental consent protections for children and young teens and increase its in-game disclosures related to its virtual currency and rewards for players in the U.S. In addition, it will also allow users to directly purchase content, using real money, from the game’s loot boxes and will cease misrepresenting the odds of loot boxes. The company must also restrict children under the age of 16 from purchasing loot boxes without parental consent.
A New Protected Category in Illinois: Family Responsibility
Effective January 1, 2025, Illinois protects from discrimination employees who provide personal care to family members. In so doing, Illinois joins several other states that provide a cause of action to employees who believe they face discrimination on the basis of “family responsibilities.”
The Law
House Bill 2161 amends Illinois’ existing Human Rights Act, the state’s version of Title VII of the Civil Rights Act of 1964. Prior to House Bill 2161, the Illinois Human Rights Act (“IHRA”) prohibited discrimination and harassment on the basis of actual or perceived race, color, religion, national origin, ancestry, age, sex, marital status, order of protection status, disability, military status, sexual orientation, pregnancy, unfavorable discharge from military service, citizenship status, or work authorization status. Now, effective in 2025, “family responsibilities” has been added to the list of protected categories.
The law defines family responsibilities as “an employee’s actual or perceived provision of personal care to a family member.” To define “family member” and “personal care,” the law references the existing definitions in the Illinois Employee Sick Leave Act. Under that law, covered family members are an employee’s child, stepchild, spouse, domestic partner, sibling, parent, mother-in-law, father-in-law, grandchild, grandparent, or stepparent. And “personal care” includes, but is not limited to, taking a family member to doctor appointments, tending to a family member’s medical, hygiene, nutritional, or safety needs, and providing emotional support to a family member with a serious health condition who is receiving inpatient or home care.
In addition to the discrimination and harassment protection, employees with family responsibilities, as defined under the law, also have protection from retaliation if they have made a report of discrimination on the basis of family responsibilities.
To guard against potential overbreadth of the law, Illinois added a provision that states employers are not obligated to “make accommodations or modifications to reasonable workplace rules for an employee based on family responsibilities” such as those related to leave, scheduling, productivity, attendance, absenteeism, timeliness, performance, and benefits. This is true, however, so long as these workplace rules are “applied in accordance with the [IHRA].” It is difficult to discern exactly how this limitation will interact with claims for familial responsibility discrimination, but this provision does make clear that the new law does not independently obligate employers to provide accommodations for familial responsibilities akin to, for example, the interactive process for disability discrimination claims, so long as the existing workplace rules are reasonable and enforced appropriately.
Steps Employers Should Take
Illinois employers should take note of this new protection for employees with family responsibilities and consider whether their actions or policies may be construed to discriminate on the basis of familial responsibilities – whether those responsibilities are actual or perceived. The law should also remind employers nationwide that the federal American with Disabilities Act provides protection to employees on the basis of their “association” with a disabled individual, such as a close family member or friend. Moreover, other states have laws with caregiver protections like Illinois – including Alaska, Delaware, Minnesota, and New York.
Employers should stay abreast of continued developments at the state and local level regarding familial and caregiver discrimination.
Maryland’s FAMLI Program, Part I: An Overview of The Law
In 2022, the Maryland General Assembly overrode Governor Larry Hogan’s veto to enact the law that created the Family and Medical Leave Insurance (FAMLI) program. Applicable to all employers with Maryland employees and starting July 1, 2026, the program will provide most employees in Maryland with twelve weeks of paid family and medical leave, with the possibility of an additional twelve weeks of paid parental leave. Contributions from employers and employees to fund the program will begin July 1, 2025.
Quick Hits
Maryland’s Family and Medical Leave Insurance (FAMLI) program provides most Maryland employees with up to twelve weeks of paid leave, with some eligible for an additional twelve weeks, starting July 1, 2026, funded by contributions from both employers and employees beginning July 1, 2025.
The Maryland Department of Labor has released two sets of proposed regulations for the FAMLI program.
Under the FAMLI program, employees in Maryland will be eligible for paid leave for various family and medical reasons, and if they take leave for their own medical reasons, they will be eligible for an additional twelve weeks for parental bonding purposes.
There is much that employers may need to do to prepare. That preparation will depend on regulations issued by the Maryland Department of Labor (MDOL) to implement the law. Thus far, the MDOL has released two sets of proposed regulations, with more to come. The first set, released in October 2024, covers general provisions, contributions, equivalent-private insurance plans, and claims, while the second set, released on January 13, 2025, and currently open for public comment, covers dispute resolution. Part one of this multipart series explains the law, with parts two and three summarizing the proposed regulations, as well as employer concerns.
The law sets forth a general framework for the program, consisting of the following elements:
Leave Amount and Reasons for Leave
Effective July 1, 2026, all employees who have worked at least 680 hours in Maryland over the prior twelve months will be eligible to receive up to twelve weeks of paid leave for their own serious health condition, to care for a family member’s serious health condition, for parental bonding (including kinship care), to care for an injured or ill military servicemember who is next of kin, or for certain qualifying exigency reasons related to a servicemember’s active duty. If an employee has taken FAMLI leave for their own serious health condition, they may receive an additional twelve weeks for parental bonding purposes (and vice versa). The law requires employees to take leave in a minimum of four-hour increments.
Family members include the child of the employee or their spouse, the parent of the employee or their spouse, the employee’s spouse or domestic partner, and the employee’s grandparent, grandchild, or sibling. These include biological, adopted, foster, step, legal guardian, and in loco parentis relationships.
Contributions
The benefits will be administered through a state program, which will be funded through contributions from employers and employees, starting July 1, 2025. The rate of contribution will be determined annually by the Maryland secretary of labor, but is capped at 1.2 percent of an employee’s wages, up to the Social Security wage base (which will be $176,100 in 2025). The law splits contributions 50-50, unless the employer elects to make the employee share of the contribution as well. The law does not require small employers (those with fewer than fifteen employees) to submit the employer portion of the contribution (although employee contributions are still required), and the Maryland Department of Health will reimburse certain licensed/certified community health providers for up to the full amount of their share of the premium.
Employer Notice to Employees
The law requires covered employers to provide written notice to employees of their rights and duties under the law upon hire, annually, and within five days when leave is requested or when the employer knows leave may qualify.
Employee Notice to Employers
If the need for leave is foreseeable, the law requires employees to provide employers with at least thirty days’ written notice of their intention to take leave. If it is not foreseeable, they must provide notice as soon as practicable and generally comply with the employer’s absence-reporting requirements. If intermittent leave is required, the employee must make a reasonable effort to schedule the leave to not unduly disrupt business operations.
Employee Application for Benefits
Employees may apply for benefits up to sixty days before and sixty days after the anticipated start date of the leave, although the MDOL may waive the filing deadlines for good cause. Employers have five days to respond to an application.
Interaction With Other Benefits
FAMLI leave will run concurrently with federal Family and Medical Leave Act (FMLA) leave. Employers may not require employees to use vacation, sick leave, or other paid time off before or while receiving FAMLI benefits, although employers may permit employees to use such leave to bridge the difference between FAMLI benefits and full pay. However, if an employer provides paid leave specifically for purposes of parental bonding, family care, military leave, or disability, the employer may require employees to use such leave concurrently or coordinated with FAMLI leave. Employees receiving unemployment insurance benefits or workers’ compensation benefits (other than for a permanent partial disability) are not eligible for FAMLI benefits.
Job Protection and Health Benefits
During FAMLI leave, the law states that employers may discharge employees only for cause. They must otherwise be reinstated to their job, unless the employer determines that reinstatement will cause “substantial and grievous economic injury” to their operations and has notified the employee of that fact. In addition, the law requires employers to maintain the employee’s health benefits during FAMLI leave.
Private Employer Plans
Employers may establish their own plan or utilize a certified third-party insurance plan that meets or exceeds the rights, protections, and benefits provided to employees under the law. For such private employer plans to be valid, the MDOL, which is directed to establish “reasonable criteria” for such plans, must approve the plan.
DOL Clarifies That FMLA Paid Leave Substitution Rules Apply When Employees Receive State or Local Paid Leave Benefits
As more states implement paid family leave programs, employers increasingly are faced with questions about how these state programs interact with Family Medical Leave Act of 1993 (FMLA) regulations. A recent opinion letter from the U.S. Department of Labor’s (DOL) Wage and Hour Division (WHD) provides important guidance on this issue.
In an opinion letter dated January 14, 2025, the WHD clarified whether FMLA regulations on the “substitution of paid leave in 29 C.F.R. § 825.207(d) apply when employees take leave under state paid family leave programs.”
Quick Hits
The DOL’s Wage and Hour Division clarified that in the same way employers cannot require the substitution of accrued employer-provided paid leave benefits when employees receive compensation from disability plans and workers’ compensation programs, employers may not unilaterally require employees to substitute accrued employer-provided paid leave benefits when employees receive compensation from state or local paid family or medical leave programs.
The Wage and Hour Division also reiterated that the substitution provision would apply that if an employee’s FMLA-qualifying leave is unpaid.
The DOL Opinion Letter
On January 14, 2025, the WHD issued an opinion letter regarding the FMLA “substitution rule” applicability when employees are receiving state paid family leave benefits. The WHD concluded that the substitution rule did apply and that employers could not require employees to use accrued paid leave when employees were receiving paid family leave benefits. The WHD recognized in its opinion that FMLA regulations did not address the issue directly.
The FMLA provides unpaid job-protected leave for eligible employees for qualifying reasons like childbirth, personal health conditions, or caregiving for a sick family member. Under the FMLA substitution regulation, an employee may elect or an employer may require the employee to “substitute” accrued employer-provided paid leave benefits for any part of the unpaid FMLA leave. Allowing an employee to substitute accrued paid leave helps mitigate an employee’s wage loss.
The WHD consistently has taken the position that neither the employer nor the employee unilaterally can require or elect substitution of employer-provided accrued paid leave during a FMLA absence in which the employee receives disability or workers’ compensation benefits because the employee is on paid, not unpaid, leave. However, an employee and employer mutually may agree, subject to state law requirements, that employees may supplement or “top off” benefits from a disability or workers’ compensation program so that employees receive up to 100 percent of their normal wages.
Because the FMLA only provides unpaid leave, several states have implemented their own paid family and medical leave programs. These programs vary from state to state, but generally provide employees with partial income replacement benefits during their leave for qualifying reasons that often overlap with the qualifying reasons for leave pursuant to the FMLA.
The WHD drew a parallel between paid family leave programs and employer-provided disability and workers’ compensation programs. The opinion letter explained that the FMLA substitution provision does not apply for compensated leave designated as FMLA-qualifying leave regardless of whether an employee receives compensation from either an employer-provided disability or workers’ compensation program, or a state or local family and medical leave program. Accordingly, an employer cannot require that employees use accrued employer-provided paid leave benefits during a FMLA leave when the employee is receiving state or local family and medical leave program benefits.
The WHD’s position is consistent with many states’ approaches to the required substitution issue. For example, California prohibits employers from forcing employees to use PTO/vacation when receiving California Paid Family Leave benefits. Similarly, the Colorado Paid Family and Medical Leave Insurance (FAMLI) program prohibits employers from requiring employees to use or exhaust any accrued vacation leave, sick leave, or other paid time off prior to or while receiving FAMLI benefits, although they mutually may agree to do so. In Massachusetts, employers must allow, but may not require, employees receiving Paid Family and Medical Leave (PFML) benefits to supplement or “top off” their PFML benefits with available employer-provided accrued paid leave.
FTC Finalizes Long-Awaited Updates to Children’s Privacy Rule
On January 16, 2025, the FTC announced the issuance of updates to the FTC’s Children’s Online Privacy Protection Rule (the “Rule”), which implements the federal Children’s Online Privacy Protection Act of 1998 (“COPPA”). The updates to the Rule come more than five years after the FTC initiated a rule review. The Commission vote on the Rule was 5-0, with various Commissioners filing separate statements. The updated Rule, which will be published in the Federal Register, contains several significant changes, but also stops short of the version proposed by the FTC in January 2024. The Rule will go into effect 60 days after its publication in the Federal Register; most entities subject to the Rule will have one year after publication to comply.
Key updates to the Rule include:
Requirement to obtain opt-in consent for targeted advertising to children and other disclosures of children’s personal information to third parties: The Rule will require operators of child-directed websites or online services to obtain separate verifiable parental consent before disclosing children’s personal information to third parties. According to a statement filed by outgoing FTC Chair Lina Khan, this means that operators will be prohibited from selling children’s personal information or disclosing it for targeted advertising purposes unless parents separately agree and opt in to these uses.
Limits on data retention: The Rule will prevent operators from retaining children’s personal information for longer than necessary than the specific documented purposes for which the data was collected. Operators also must maintain a written data retention policy that (1) details the specific business need for retaining children’s personal information and (2) sets forth a timeline for deleting this data. Operators may not retain children’s personal information indefinitely.
Changes to key definitions: The Rule also makes several changes to the definitions that govern its application. For example, the definition of “personal information” now includes biometric identifiers that can be used for the automated or semi-automated recognition of a child (e.g., fingerprints, handprints, retina patterns, iris patterns, genetic data – including a DNA sequence, voiceprints, gait patterns, facial templates, or faceprints). In addition, the factors the Commission will take into account in considering whether a website or service is “directed to children” will be expanded to include marketing or promotional materials or plans, representations to consumers or third parties, reviews by users or third parties and the ages of users on similar websites or services.
Increased Safe Harbor transparency: FTC-approved COPPA Safe Harbor programs are required to identify in their annual reports to the Commission each operator subject to the self-regulatory program (“subject operator”) and all approved websites or online services, as well as any subject operator that left the program during the time period covered by the annual report. The Safe Harbor programs also must outline their business models in greater detail and provide copies of each consumer complaint related to a member’s violation of the program’s guidelines. In addition, Safe Harbor programs must publicly post a list of all current subject operators and, for each such operator, list each certified website or online service.
Importantly, the Rule is notable for what it does not contain.
No EdTech changes: Despite having proposed imposing a wide range of obligations on EdTech companies operating in the education space, the Rule avoids incorporating any education-related requirements. According to the FTC, because the Department of Education has indicated its intention to update its FERPA regulations (34 C.F.R. 99), the Commission sought to avoid changing COPPA in any way that might conflict with the DOE’s eventual amendments. Instead, the Commission states it will continue to enforce COPPA in the EdTech context consistent with its existing guidance.
No coverage of user engagement techniques: The Rule does not incorporate the proposal to require parental notification and consent for the collection of data used to encourage or prompt children’s prolonged use of a website or online service. The Commission indicated that, after reviewing the public comments, it believes the proposed use restriction “was overly broad and would constrain beneficial prompts and notifications.” The FTC cautioned, however, that it nevertheless may pursue enforcement under Section 5 of the FTC Act in appropriate cases to address unfair or deceptive acts or practices encouraging prolonged use of websites and online services that increase risks of harm to children.
Personalization and contextual advertising still exempted: The Rule does not limit the “support for the internal operations” exemption under COPPA to exclude operator-driven personalization or contextual advertising.
No need to tie personal information collected to specific uses: The Rule will not require that operators correlate each data element collected online from children to the particular use(s) of such data element.
In voting in support of the revised Rule, incoming FTC Chair Andrew Ferguson filed a separate statement expressing what he termed “serious problems” with the Rule, which he blamed on “the result of the outgoing administration’s irresponsible rush to issue last-minute rules.” Ferguson would have required the Rule to clarify instances in which an operator’s addition of third parties to whom they provide children’s personal information would trigger a need for updated notice and refreshed consent. He also took issue with the prohibition on indefinite retention of children’s personal information, predicting that it “is likely to generate outcomes hostile to users.” Finally, he indicated his belief that the FTC missed an opportunity to make clear the Rule is not an obstacle to the use of children’s personal information solely for the purpose of age verification.