SENATE BILL 375
52nd legislature - STATE OF NEW MEXICO - first session, 2015
INTRODUCED BY
Jacob R. Candelaria
AN ACT
RELATING TO EMPLOYMENT; CREATING THE NEW MEXICO FAMILY ACT; PROVIDING FOR A STATE UNPAID FAMILY AND MEDICAL LEAVE PROGRAM ADMINISTERED BY THE WORKFORCE SOLUTIONS DEPARTMENT; CREATING THE FAMILY AND MEDICAL LEAVE COMPENSATION FUND; PROVIDING FOR A SUPPLEMENTAL INCOME TAX DISTRIBUTED TO THE FAMILY AND MEDICAL LEAVE COMPENSATION FUND; PROVIDING FOR ADMINISTRATION OF THE FAMILY AND MEDICAL LEAVE COMPENSATION FUND BY THE WORKFORCE SOLUTIONS DEPARTMENT; PROVIDING FOR COMPENSATION FROM THE FAMILY AND MEDICAL LEAVE COMPENSATION FUND TO EMPLOYEES WHO ARE TAKING UNPAID FAMILY AND MEDICAL LEAVE; ESTABLISHING CONDITIONS OF ELIGIBILITY FOR COMPENSATION FROM THE FAMILY AND MEDICAL LEAVE COMPENSATION FUND; REQUIRING RULEMAKING; ALLOWING AN INCOME TAX DEDUCTION; MAKING AN APPROPRIATION.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:
SECTION 1. [NEW MATERIAL] SHORT TITLE.--Sections 1 through 10 of this act may be cited as the "New Mexico Family Act".
SECTION 2. [NEW MATERIAL] FINDINGS AND PURPOSE.--
A. The legislature finds that:
(1) without paid family and medical leave, many New Mexico workers are unable to afford to take time away from work to care for themselves, ill or at-risk parents and relatives or newborn or newly adopted children, but few New Mexico workers have access to paid family and medical leave;
(2) often, workers who are eligible to take leave pursuant to the federal Family and Medical Leave Act of 1993, which does not provide leave compensation, are unable to take advantage of that right because they cannot afford to exercise it. Moreover, the federal Family and Medical Leave Act of 1993 only applies to businesses that employ at least fifty employees within a given locale and does not apply to domestic partners. Thus, a state law allowing all eligible employees access to family and medical leave without pay from their employers and to reasonable compensation during that time of leave is necessary;
(3) family caregiving has a high societal value, and working caregivers should not have to risk their families' financial security in order to carry out caregiving responsibilities;
(4) as the population ages, the number of people with long-term health issues is on the increase, as is the need for family members to provide care for these elders;
(5) at the time a child is born or adopted, both a mother and father's ability to spend time bonding with the new child leads to individuals and families that are both physically and mentally healthier than when economic circumstances force a parent's quick return to work because there is no access to paid family and medical leave. A statewide paid family and medical leave program will enable more New Mexicans to be involved in caregiving and child-bonding and will promote families' financial security and independence; and
(6) helping families adapt to the competing interests of work and home not only benefits workers but also benefits employers by increasing worker productivity and reducing worker turnover.
B. The purpose of the New Mexico Family Act is to enable workers to take time away from work for their own serious health issues, to provide physical or mental health care for family members who cannot care for themselves or to provide care for and bond with a newborn or newly adopted minor child by providing the right to take unpaid family and medical leave and to receive a reasonable level of compensation during that unpaid time away from work.
SECTION 3. [NEW MATERIAL] DEFINITIONS.--As used in the New Mexico Family Act:
A. "child" means a biological, adopted or foster child, a stepchild, a legal ward or a child of a person standing in loco parentis, who is:
(1) under eighteen years of age; or
(2) eighteen years of age or older and incapable of self-care because of mental or physical disability;
B. "department" means the workforce solutions department, the secretary of workforce solutions or an employee of the department exercising authority lawfully delegated to that employee by the secretary;
C. "domestic partner" means a person who is at least eighteen years of age, who is not married or a member of another domestic partnership, who is in an exclusive committed relationship with and for the benefit of the other partner, who has shared a primary residence with the other partner for twelve or more consecutive months, who is jointly responsible with the other partner for each other's common welfare, who shares joint financial obligations with the other partner and who does not have a blood relationship with the other partner that would preclude marriage between them under New Mexico law;
D. "employee" means either an individual domiciled within the state who performs services either within or without the state for an employer or, to the extent permitted by law, an individual domiciled outside of the state who performs services within the state for an employer;
E. "employer" means a person or an officer, agent, successor in interest or employee of that person having control of the payment of wages, doing business in or deriving income from sources within the state for whom an individual performs or performed any service as the employee of that person, except that if the person for whom the individual performs or performed the services does not have control over the payment of the wages for such services, "employer" means the person having control of the payment of wages;
F. "health care provider" means a person licensed by the state or permitted by law to provide health care services;
G. "parent" means the biological parent of an employee or an individual who stood in loco parentis to the employee when the employee was a child;
H. "serious health condition" means an illness, injury, impairment or physical or mental condition that involves:
(1) inpatient care in a hospital, hospice or residential medical facility; or
(2) continuing treatment by a health care provider;
I. "spouse" means a partner to a lawful marriage; and
J. "wages" means remuneration in cash or other form for services performed by an employee for an employer.
SECTION 4. [NEW MATERIAL] ENTITLEMENT TO LEAVE.--
A. Subject to the certification requirements provided in Section 5 of the New Mexico Family Act, an employee may request from an employer and shall be entitled to a total of twelve workweeks of leave during any twelve-month period for one or more of the following:
(1) the birth of a child of the employee and the provision of care for that child;
(2) the placement of a minor child with the employee for adoption or foster care and the provision of care for that child;
(3) the provision of care for the spouse, child, parent or domestic partner of the employee, if the spouse, child, parent or domestic partner has a serious health condition; or
(4) a serious health condition that makes the employee unable to perform the functions of the position of the employee.
B. The entitlement to leave under Paragraphs (1) and (2) of Subsection A of this section for a birth or placement of a child shall expire at the end of the twelve-month period beginning on the date of the birth or placement.
C. The leave granted pursuant to this section may be unpaid leave.
D. In a case in which domestic partners or married spouses entitled to leave under this section are employed by the same employer, the aggregate number of workweeks of leave to which both may be entitled may be limited to twelve workweeks during any twelve-month period, if the leave is taken:
(1) pursuant to Paragraphs (1) and (2) of Subsection A of this section; or
(2) to care for a sick parent under Paragraph (3) of Subsection A of this section.
E. The department shall promulgate rules:
(1) setting the form of the request;
(2) addressing how intermittent leave or a reduced-leave schedule and paid leave may be used in providing the entitlement to leave granted in this section; and
(3) addressing the scheduling and notice by employees to employers of leave to be taken.
SECTION 5. [NEW MATERIAL] CERTIFICATION.--
A. An employer shall require that a request for leave pursuant to Section 4 of the New Mexico Family Act be supported by a certificate, developed by the department, issued by the employee in the case of the birth or placement of a child or by a health care provider of the employee or of the child, spouse, parent or domestic partner of the employee in the case of a serious medical condition, as appropriate. The employee shall provide, in a timely manner, a copy of the certificate to the employer.
B. The certificate provided pursuant to this section shall be sufficient if it states:
(1) the date on which the birth or placement of the child occurred or will occur or when the serious health condition commenced; and
(2) in the case of a serious medical condition:
(a) the probable duration of the condition and, as appropriate, a statement that the employee is needed to care for the child, spouse, parent or domestic partner of the employee and an estimate of the amount of time that the employee will be needed to provide the care or a statement that the employee is unable to perform the functions of the position of the employee and an estimate of the amount of time the employee will be unable to perform those functions; and
(b) the appropriate medical facts within the knowledge of the health care provider regarding the condition.
C. The department shall promulgate rules to address how an employer may challenge the validity of a certificate and how conflicts of opinion arising from the certificate may be resolved.
SECTION 6. [NEW MATERIAL] EMPLOYMENT AND BENEFITS PROTECTION.--
A. An employee who takes leave pursuant to the New Mexico Family Act shall be entitled, on return from that leave:
(1) to be restored by the employer to the position of employment held by the employee when the leave commenced; or
(2) to be restored to an equivalent position with equivalent employment benefits, wages and other terms and conditions of employment.
B. The taking of leave pursuant to the New Mexico Family Act shall not result in the loss of an employment benefit accrued prior to the date on which the leave commenced.
C. Nothing in this section shall be construed to entitle a restored employee to:
(1) the accrual of seniority or employment benefits during a period of leave; or
(2) a right, benefit or position of employment other than a right, benefit or position to which the employee would have been entitled had the employee not taken the leave.
D. As a condition of restoration under Subsection A of this section, the employer of an employee who has taken leave for a serious medical condition may have a uniformly applied practice or policy that requires the employee to receive certification from a health care provider that the employee is able to resume work, except that nothing in this subsection shall supersede a valid law or a collective bargaining agreement that governs the return to work of that employee.
E. Nothing in this section shall prohibit an employer from requiring an employee on leave to report periodically to the employer on the status and intention of the employee to return to work.
F. Except as provided in Subsection G of this section, during a period that an employee takes leave pursuant to the New Mexico Family Act, the employer shall maintain coverage under a group health plan approved by the superintendent of insurance for the duration of the leave at the level and under the conditions that coverage would have been provided if the employee had continued in employment continuously for the duration of the leave.
G. The employer may recover from the employee the premium that the employer paid for maintaining group health plan coverage for the employee pursuant to Subsection F of this section if the employee fails to return from leave after the period of leave to which the employee is entitled has expired for a reason other than the continuation, recurrence or onset of a serious health condition that entitled or entitles the employee to leave or other circumstances beyond the control of the employee.
H. An employer may require that a claim that an employee is unable to return to work because of the continuation, recurrence or onset of the serious health condition be supported by a certificate issued by a health care provider and submitted to the employer stating that a serious health condition prevented the employee from being able to perform the functions of the position of the employee on the date that the leave of the employee expired or that the employee is needed to care for the child, spouse, parent or domestic partner of the employee who has a serious medical condition on the date that the leave expired.
SECTION 7. [NEW MATERIAL] RECORDS RETENTION.--
A. A certificate or other documentation required to be submitted by an employee or health care provider to an employer pursuant to the New Mexico Family Act shall be retained and available for disclosure to the department or other person authorized by that act to investigate unlawful acts for at least five years from the date of submission to the employer.
B. The department shall promulgate rules regarding the records to be created and kept pertaining to compliance with the New Mexico Family Act.
SECTION 8. [NEW MATERIAL] FAMILY AND MEDICAL LEAVE COMPENSATION FUND CREATED--ADMINISTRATION.--
A. The "family and medical leave compensation fund" is created as a nonreverting fund in the state treasury and shall be administered by the workforce solutions department. The fund shall consist of the net revenue attributable to the family and medical leave income tax and the family and medical leave corporate income tax and any money that is appropriated or donated or that otherwise accrues to the fund. Money in the fund shall be invested by the state investment officer in the manner that land grant permanent funds are invested pursuant to Chapter 6, Article 8 NMSA 1978. Income from investment of the fund shall be credited to the fund.
B. Money in the family and medical leave compensation fund is appropriated to the workforce solutions department to make family and medical leave compensation payments pursuant to the New Mexico Family Act and to administer the provisions of that act.
C. Money shall be disbursed from the family and medical leave compensation fund only on warrant of the secretary of finance and administration upon vouchers signed by the secretary of workforce solutions or the secretary's authorized representative. Any unexpended or unencumbered balance remaining at the end of a fiscal year shall not revert to the general fund.
SECTION 9. [NEW MATERIAL] FAMILY AND MEDICAL LEAVE COMPENSATION--CLAIM--BENEFIT--APPLICATION.--
A. An employee who has been granted a period of unpaid leave in excess of five days pursuant to the federal Family and Medical Leave Act of 1993 or the New Mexico Family Act may file a claim with the department for family and medical leave compensation. The claim shall be submitted to the department after the fifth day of unpaid leave but no later than forty-nine days after the first day of unpaid leave.
B. Family and medical leave compensation shall be a daily benefit for each day of unpaid leave granted pursuant to the federal Family and Medical Leave Act of 1993 or the New Mexico Family Act, beginning with the sixth day of unpaid leave, equal to nine percent of the employee's average weekly wages for the month immediately preceding the first day of unpaid leave. The maximum benefit payable in a twelve-month period beginning with the first day of unpaid leave is forty-two times the daily benefit.
C. A claim shall be made by submitting an application to the department, on a form developed by the department, accompanied by:
(1) the certificate and other documentation submitted by the employee or health care provider to an employer to qualify the employee for unpaid leave pursuant to the federal Family and Medical Leave Act of 1993 or the New Mexico Family Act;
(2) a certificate of the employer, on a form developed by the department, that confirms the period of unpaid leave granted to the employee and the employee's weekly wages for the month immediately preceding the first day of the period of unpaid leave so confirmed; and
(3) additional documentation required by the department to support the employee's eligibility for family and medical leave compensation.
D. Upon receipt of a claim application, the department shall determine the employee's eligibility and determine the amount of daily family and medical leave compensation benefit. The department shall notify the employee of the amount of the daily benefit and request any additional information needed to determine eligibility. If the employee is determined to be eligible, the department shall mail a check or otherwise pay the employee the family and medical leave compensation benefit for the number of days of unpaid leave covered in the claim. If the department determines that the employee is not eligible for family and medical leave compensation, it shall notify the employee in writing of that determination and the reasons why.
E. The department shall promulgate rules for the administration of the compensation benefit claim, application, notification and payment process described in this section.
SECTION 10. [NEW MATERIAL] NOTICE.--An employer shall post and keep posted, in conspicuous places upon its premises where notices to employees and applicants for employment are customarily posted, a notice, to be developed by the department, setting forth excerpts from, or summaries of, the pertinent provisions of the New Mexico Family Act and information pertaining to enforcing compliance with that act. An employer that willfully violates this section shall be assessed a civil money penalty not to exceed one hundred dollars ($100) for each separate offense.
SECTION 11. A new section of the Tax Administration Act is enacted to read:
"[NEW MATERIAL] DISTRIBUTION--FAMILY AND MEDICAL LEAVE INCOME TAX--FAMILY AND MEDICAL LEAVE CORPORATE INCOME TAX.--A distribution pursuant to Section 7-1-6.1 NMSA 1978 shall be made to the family and medical leave compensation fund of the net revenue attributable to the family and medical leave income tax and the family and medical leave corporate income tax."
SECTION 12. A new section of the Income Tax Act is enacted to read:
"[NEW MATERIAL] FAMILY AND MEDICAL LEAVE INCOME TAX--RATE.--In addition to the tax imposed by Section 7-2-3 NMSA 1978, a supplemental tax is imposed at the rate of two-tenths percent on the taxable income of every resident individual and on the taxable income of every nonresident individual employed or engaged in the transaction of business in, into or from this state, or deriving any income from any property or employment within this state. The tax imposed by this section may be referred to as the "family and medical leave income tax"."
SECTION 13. A new section of the Income Tax Act is enacted to read:
"[NEW MATERIAL] DEDUCTION--FAMILY AND MEDICAL LEAVE INCOME TAX LIABILITY.--
A. A taxpayer that is a business and that has a family and medical leave income tax liability may claim a deduction from net income in an amount equal to fifty percent of what that liability would be if not for the deduction pursuant to this section.
B. Married individuals filing separate returns for a taxable year for which they could have filed a joint return may each claim only one-half of the deduction provided by this section that would have been claimed on a joint return.
C. A taxpayer allowed a deduction pursuant to this section shall report the amount of the deduction to the department in a manner required by the department.
D. The department shall compile an annual report on the deduction provided by this section that shall include the number of taxpayers that claimed the deduction, the aggregate amount of deductions claimed and any other information necessary to evaluate the effectiveness of the deduction. Beginning in 2020, the department shall compile and present the annual reports to the revenue stabilization and tax policy committee and the legislative finance committee with an analysis of the cost and benefit to the state of the deduction."
SECTION 14. A new section of the Corporate Income and Franchise Tax Act is enacted to read:
"[NEW MATERIAL] FAMILY AND MEDICAL LEAVE CORPORATE INCOME TAX--RATE.--In addition to the taxes imposed by Section 7-2A-3 NMSA 1978, a supplemental tax is imposed at the rate of two-tenths percent on the net income of every domestic corporation and on the net income of every foreign corporation employed or engaged in the transaction of business in, into or from this state or deriving any income from any property or employment within this state. The tax imposed by this section may be referred to as the "family and medical leave corporate income tax"."
SECTION 15. A new section of the Corporate Income and Franchise Tax Act is enacted to read:
"[NEW MATERIAL] DEDUCTION--FAMILY AND MEDICAL LEAVE CORPORATE INCOME TAX LIABILITY.--
A. A taxpayer that has a family and medical leave corporate income tax liability may claim a deduction from net income in an amount equal to fifty percent of what that liability would be if not for the deduction pursuant to this section.
B. A taxpayer allowed a deduction pursuant to this section shall report the amount of the deduction to the department in a manner required by the department.
C. The department shall compile an annual report on the deduction provided by this section that shall include the number of taxpayers that claimed the deduction, the aggregate amount of deductions claimed and any other information necessary to evaluate the effectiveness of the deduction. Beginning in 2020, the department shall compile and present the annual reports to the revenue stabilization and tax policy committee and the legislative finance committee with an analysis of the cost and benefit to the state of the deduction."
SECTION 16. TEMPORARY PROVISION.--Notwithstanding the effective date of Sections 1 through 15 of this act, the workforce solutions department shall comply with the rulemaking provisions of Subsection E of Section 4, Subsection C of Section 5, Subsection B of Section 7 and Subsection E of Section 9 of the New Mexico Family Act beginning July 1, 2015.
SECTION 17. APPROPRIATION.--One million dollars ($1,000,000) is appropriated from the general fund to the family and medical leave compensation fund for expenditure in fiscal year 2016 and subsequent fiscal years to provide for rulemaking and the administration of the provisions of the New Mexico Family Act and to make family and medical leave compensation payments pursuant to that act. Any unexpended or unencumbered balance remaining at the end of a fiscal year shall not revert to the general fund.
SECTION 18. APPLICABILITY.--The provisions of Sections 12 through 15 of this act apply to taxable years beginning on and after January 1, 2018.
SECTION 19. EFFECTIVE DATE.--
A. The effective date of the provisions of Sections 1 through 15 of this act is July 1, 2018.
B. The effective date of the provisions of Sections 16 and 17 of this act is July 1, 2015.
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