Our New Year's Resolution: Keeping You Informed
The year 2020 will bring several changes to benefit your workers. Stay informed to help your employees understand what's new.
To support these positive changes, program contributions are increasing for many New Jersey workers.
All New Jersey employees contribute to the cost of Temporary Disability and Family Leave Insurance through a salary deduction that you are responsible for listing on their paystubs. This salary deduction continues until their gross earnings reach a specific amount in a year, known as the wage cap. After the wage cap is met, salary deductions are no longer taken for the remainder of the year.
As of January 1, 2020, the employee wage cap is increasing from $34,400 to $134,900 per year.
For 2019, workers contribute 0.17% of the first $34,400 earned during the calendar year. That means if and when your employee earns $34,400 in a calendar year, these deductions should no longer be taken from their paycheck for the remainder of the year.
The most they can contribute for 2019 is $58.48.
As of January 1, 2020, workers contribute 0.26% of the first $134,900 earned during the calendar year. That means that workers who do not earn $134,900 in a year will continue to have deductions taken out year round.
The most they can contribute for 2020 is $350.74.
For 2019, workers contribute 0.08% of the first $34,400 earned during the calendar year. That means if and when your employee earns $34,400 in a calendar year, these deductions should no longer be taken from their paycheck for the remainder of the year.
The most that they can contribute for 2019 is $27.52.
As of January 1, 2020, workers contribute 0.16% of the first $134,900 earned during the calendar year. That means workers who do not earn $134,900 in a year continue to have deductions taken out year round.
The most that they can contribute for 2020 is $215.84.
Though there are major increases to the wage cap for your workforce in 2020, employers' contributions do not have any significant changes.
For Temporary Disability Insurance in 2019, employer contribution rates vary between 0.10% to 0.75% on the first $34,400 earned by each employee during the calendar year.
For Temporary Disability Insurance in 2020, the contribution rate continues to vary between 0.10% to 0.75%, but the wage cap increases to $35,300 for the calendar year.
On the other hand, Family Leave Insurance is funded solely by employees.
Moving forward in 2020, your workers may notice payroll deductions continuing for longer than had occurred in previous years. It may be a good idea to bookmark this page, or print it out for reference. Here is a helpful resource for your workers to read.