Coloradans will see 'FAMLI' leave deduction on paychecks

Many Colorado employees will see some wages withheld on their next paychecks as the state begins collecting funds for its new Family and Medical Leave Insurance (FAMLI) program.

It's been two years since voters passed the major overhaul known as Proposition 118. Just long enough that many have forgotten, the benefits don't kick in until 2024 and you have to start paying for it now.

"In order to fund the program, we're starting to collect premiums from employers and employees beginning Jan 1st of this year," said Tracy Marshall, Director of state-paid medical and family leave. "It certainly does take a little to remind folks that hey this is what was voted in this is not new this has been coming for two years."

For employers with greater than 10 employees, the new premium is going to be .9% and up to .45% can be withheld from employees. That could be up to $4.50 of every $1,000 in wages that could be withheld. 

The state said companies still have time to get things in order- registration needs to be completed before April 30th, when the first premium payment is due.

On Wednesday, the state told CBS News Colorado it had already received 42,000 registrations. FAMLI affects Colorado local government employers differently than private businesses and local governments are allowed to opt out of the program altogether.

The state says more than 1,200 local governments have opted out so far.

There have been some learning curves as businesses try to prepare employees and themselves for a new process.

Once the program launches in 2024, every private employee in Colorado will be able to have their wages covered for 12 to 16 weeks. Experts say making sure employers have a streamlined process is key.

"That's a long time for someone to be out of the workforce so that's gonna create the opportunity to rethink how we're staffed and how we balance those folks when they're not at work," said Christie Doherty, vice president of client services for HR Choice.

HR Choice represents more than 70 Colorado small businesses and non-profits. Doherty said the company has been through the details of FAMLI with each.

"The premium is so affordable from an employee point of view, so I think there's a lot of goodness in it for employees. I think for employers, it's just making sure it's a streamlined process and we can anticipate those absences," she said.

Employees with the lowest incomes will receive the most support under the graduated scale system- up to 90 percent of their normal weekly income. People with higher-paying jobs could get as little as 37% of their weekly check.

With inflation, there has been concern that the new premium for employers could drive up costs for consumers. The state told CBS News Colorado on Wednesday that it shouldn't be a problem.

More resources here:

What will I need to pay?

Click here to calculate what premium you will need to pay, and what benefits you're eligible for: https://famli.colorado.gov/employers/famli-toolkit-for-employers

Local Governments may opt out, here's how: https://famli.colorado.gov/employers/local-governments

Employers must be registered before April 30th, here's how: https://famli.colorado.gov/employers/my-famli-employer

The state says there will be an option for those who are self-employed soon.