If you're a Maryland small business with at least one employee, your business will probably be subject to Maryland's new Family and Medical Leave Insurance (FAMLI) program, which goes into effect January 1, 2027.

So, what is it? In this blog, FAMLI stands for Family and Medical Leave Insurance. It's essentially a state-sponsored insurance program funded by employees and employers in Maryland. In a nutshell, it provides up to 12 weeks of paid leave for Maryland workers. The benefit can be up to approximately $1,000 per week, and it's paid by the state, not the employer.

But if you're a business owner, you're probably wondering whether this act applies to your business. In Maryland, the act applies to employers with at least one employee. That's different from the federal Family and Medical Leave Act (FMLA), which requires employers to have a larger number of employees to be subject to its mandatory provisions.

So, again, if your business has at least one employee, you're most likely required to register, submit reports, and make contributions on behalf of your company and the employees who work for you. There are a couple of exceptions, although not many.

First, if your business is owned by one person, and you're the sole owner and the only employee, your business is not considered an employer under the act and does not have to comply.

Second, if your business opts for private insurance that provides essentially the same benefits—and many companies already have this coverage—you may be able to obtain an exemption from the mandatory payroll withholding and contributions to the state program.

You'll still have to register and report to the state, but you won't have to make contributions to the state program.

This is a complicated and brand-new program. Please reach out to us with questions. We are happy to help.