Maryland Family and Medical Leave Insurance (FAMLI) - Important Employer Actions Beginning September 2026 

Maryland's Family and Medical Leave Insurance (FAMLI) program is moving into its implementation phase. Employers with employees working in Maryland should begin preparing now for registration, payroll deductions, and employee communications. 

FAMLI creates a state-administered paid family and medical leave benefit that provides eligible employees with partial wage replacement for qualifying family and medical leave. The program supplements—not replaces—your existing PTO, vacation, sick leave, or other employer-provided leave benefits. Employers should review their leave policies to ensure they coordinate appropriately with FAMLI and, where applicable, the federal Family and Medical Leave Act (FMLA).  

Client Action Items 

• Register your business in the Maryland FAMLI portal (https://account.paidleave.maryland.gov/) when registration opens in September 2026.  

  
  

• Authorize C2 Essentials as your Third-Party Administrator during the registration process.  

  
  

• No separate insurance purchase is needed if electing to participate in the Maryland State Plan. Consult with your benefits broker if you are considering a private plan*.   

  
  

How C2 Essentials Will Help 

As your HR and payroll compliance partner, C2 Essentials will: 

• Register as your authorized Third-Party Administrator (TPA).  

  
  

• Calculate and remit required FAMLI contributions.  

  
  

• Submit required quarterly wage reports.  

  
  

• Provide employee notices through C2Connection when released by the State.  

  
  

• Update client handbooks with Maryland FAMLI policy language.  

  
  

• Provide ongoing compliance guidance as additional regulations are issued.  

  
  

Key Employer Timeline 

Employer Contributions 

The initial State Plan contribution rate is 0.90% of covered wages beginning January 1, 2027. 

• Employers with fewer than 15 employees (counting employees inside and outside Maryland): 

  
  

• No mandatory employer contribution; employee payroll deductions may still apply.  

  
  

• Employers with 15 or more employees (counting employees inside and outside Maryland): 

  
  

• The total contribution is 0.90% of covered wages, with up to 0.45% deducted from employees and the remaining amount paid by the employer (unless the employer elects to pay a greater share).  

  
  

State Plan vs. Private Plan 

Employers should evaluate which option best meets their organization's needs before payroll deductions begin. 

Opting for the State Plan 

• No insurance policy is required.  

  
  

• Contributions are remitted directly to Maryland.  

  
  

• Employee claims are administered by the State.  

  
  

Opting for a Private Plan 

• Purchased through an insurance carrier or benefits broker.  

  
  

• Premiums will depend on factors such as: 

  
  

  • employer size  

    
    

  • payroll  

    
    

  • workforce demographics  

    
    

  • industry  

    
    

  • leave history  

    
    

  • plan design  

    
    

  • whether the employer already provides paid parental leave or short-term disability benefits  

    
    

• Must provide benefits that are at least equivalent to the State Plan.  

  
  

• May offer greater administrative flexibility for employers that already provide paid leave or short-term disability benefits.  

  
  

• Compare premiums and benefits and select a plan that provides benefits equal to or greater than Maryland's requirements.  

  
  

• Submit a Declaration of Intent and later a private plan application to Maryland within the required filing window.  

  
  

• Once approved, employees receive benefits through the private carrier rather than the State Plan.