Key Takeaways:
- Employers preparing for the January 1, 2026, rollout of Delaware’s Paid Family Medical Leave Insurance Program should review recent amendments to the Healthy Delaware Families Act. Among other things, the amendments prohibit employers from requiring employees to use employer-provided paid time off such as vacation or sick leave before using Paid Family Leave Insurance benefits.
Delaware enacted House Substitute No. 1 for House Bill No. 128,amending the Healthy Delaware Families Act governing the state’s Paid Family and Medical Leave Insurance Program (PFMLA) on July 30, 2025. These changes, effective immediately, introduce new compliance obligations and clarify several aspects of the law that are particularly relevant for employers preparing for the program’s rollout.
Restrictions on Mandatory Use of Paid Time Off
The amendment prohibits employers from requiring employees to use accrued paid time off (PTO) before accessing PFMLA benefits. However, employers and employees may mutually agree to use PTO to supplement paid leave benefits. PTO includes both vacation and sick leave.
Child Support Garnishment Now Permitted
Employees filing for paid leave benefits must now disclose any outstanding child support obligations. If eligible for benefits, the Department of Labor is required to notify the appropriate enforcement agency and deduct the amount owed from the employee’s benefit payments. PFMLA Designated as Primary Payor
The law now explicitly designates PFMLA benefits as the primary source of income replacement. Employers must coordinate other available benefits, such as disability insurance, with PFMLA payments according to the terms of the applicable policies. Documentation Relief for Private Plan Employers
Employers using approved private plans to meet their obligations under the law are no longer required to submit claim documentation to the Department unless the claim is subject to an appeal, complaint, audit, or specific inquiry. This change reduces the administrative burden and streamlines compliance for employers and private plan sponsors.
Voluntary Coverage Triggers Full Compliance
Employers with fewer than 25 employees who voluntarily elect to provide coverage under PFMLA are now subject to all provisions of the law. This includes the right of employees to appeal benefit decisions, aligning voluntary coverage with the obligations of larger employers.
Advisory Committee Established
The amendment creates a Paid Leave Advisory Committee to support implementation and ongoing administration of the program. The committee includes representatives from both employer and employee groups and will meet monthly through 2028, then quarterly beginning in 2029. Meetings will be open to the public and will address rulemaking, financial matters, and other operational issues.
Expanded Enforcement Mechanisms
To strengthen enforcement, the Department may now execute judgments related to unpaid assessments through property levies, bank account garnishments, and wage garnishments. Garnishees must respond within 20 days of receiving notice, and failure to comply may result in penalties equal to the amount that should have been withheld.
Benefits Protected from Creditor Claims
PFMLA benefits are now explicitly exempt from creditor claims and cannot be assigned or encumbered, except in cases involving child support garnishment. This provision ensures that benefits remain protected and available for their intended purpose.
