AIM gearing up for 2021 rollout of Family and Medical Leave Act

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PITTSFIELD — As employers prepare for the implementation of the Family and Medical Leave Act in Massachusetts, the state's largest employer organization is working to make the transition smoother.

The new law, which takes effect Jan. 1, 2021, is one of the top legislative priorities for Associated Industries of Massachusetts, its outgoing president and CEO told a group of Berkshire business leaders Thursday, at an executive briefing held at Hotel on North.

Richard C. Lord, who is retiring, also provided an overview of AIM's legislative positions on health care, education funding, transportation and proposals to provide additional revenues for the state.

Although the Family and Medical Leave Act doesn't take effect until 2021, the state will begin assessing employers a payroll tax to pay for it beginning July 1. That tax is currently set at 0.63 percent, but will be adjusted annually.

At the Legislature's request, AIM was one of the state business organizations that worked with advocacy groups to form the legislation from myriad proposals, Lord said. The law, which includes several other initiatives, has been called the "grand bargain" due to the amount of input. Some of its provisions have irked parts of the state's business community, and many of AIM's 4,000 members are among the critics.

"A lot of our members don't think it was a bargain," said Lord, who referred to the legislation as a "compromise."

"I get it. We wouldn't have put this on the table ourselves, but we were kind of playing defense at the time and tried to come up with something we all could live with."

AIM is involved in efforts to create an opt-out clause, which would allow employers with programs that offer a benefit that is greater than or equal to what an employee would receive from the state legislation to be exempt from the new law.

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"A lot of insurers are trying to make plans identical to the state's so you can opt out," Lord said. "We thought that this was an important option for employers."

The final draft regulations for the Family and Medical Leave Act were released March 31, but the law's final regulations won't be released until July 1. Although two additional public hearings on the measure are scheduled to take place next month, Lord said he didn't expect that there would be any major changes before the final regulations go into effect.

"This is going to be a challenge," Lord said, referring to the law's implementation. "It's brand new for Massachusetts. Not a lot of states have done this."

Regarding health care, AIM has filed legislation to repeal the 2019 Employer Medical Assistance Contribution, a two-year, two-tier assessment on employers to support a deficit in the state's MassHealth program due to declines in employer-sponsored coverage. The measure went into effect in January 2018. AIM is trying to repeal the second year and has been joined by several other businesses in this venture, Lord said.

AIM and the Massachusetts Taxpayers Foundation also are co-chairing an employer-led initiative to reduce avoidable emergency department visits. According to AIM, avoidable emergency department visits cost the organization's commercially insured AIM members $300 million to $350 million annually. According to AIM, 40 percent of emergency department visits are avoidable.

Lord, who is from North Adams and attended Williams College, said he is planning to retire from AIM by June. He has spent 28 years there, serving as president and CEO for more than 20.

"It's been a good run," said Lord, who maintains a residence in the Berkshires.

Business Editor Tony Dobrowolski can be reached at tdobrowolski@berkshireeagle.com or 413-496-6224.


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