Your PFML exemption, and the twelve other states you may now be filing in.
Employers in Massachusetts — and in the ten other states that permit it — can opt out of the state PFML pool with an approved private plan, often at a lower cost and always with better service. We have run that filing since Massachusetts launched in 2021, and we now run it in every state that allows one. If your people are spread across state lines, the exemption you file at home is only the first of several.
Will a private plan cost less than the state pool?
Often, yes — but not automatically, and not for everyone. The state charges a flat percentage of payroll regardless of who works for you. A private carrier underwrites your group: your census, your age bands, your industry, your claims history. Employers with a younger workforce, a white-collar risk profile, or an existing disability carrier are the ones who usually come out ahead. Employers with an older, higher-risk census sometimes do better staying in the pool.
That is the whole analysis, and it takes us about a week. We quote it both ways and show you the arithmetic. If the state pool wins, we tell you to stay in it.
A private plan usually makes sense when
- Your census skews younger or lower-risk than the state average
- You already carry short-term disability with a national carrier
- You employ people in more than one PFML state and want one administrator
- You want claims handled by a carrier team rather than a state agency queue
- You want leave data flowing into your HRIS instead of living on a state portal
The state pool is often the better answer when
- You have fewer than 25 covered individuals in Massachusetts and pay the 0.46% rate
- Your workforce is older or in a higher-claims industry
- You have no appetite for an annual renewal and re-approval cycle
- You are a single-state employer with simple, stable headcount
- Your claims experience is genuinely unknown and you would rather not be underwritten on it
Ask us to run the numbers for your group.
Send us your headcount and the states you employ in. We come back with the state cost and every private quote side by side, in about a week.
- Every state pool you pay into vs. a private plan, priced both ways
- All eleven exemption states covered, not just your home state
- An honest answer — if the state pool wins, we say so
What your employees actually collect, state by state.
Every mandated program replaces a share of wages up to a weekly ceiling. Those ceilings are not close to each other — the top of the range pays nearly double the bottom. If you have a Boston office and a Wilmington office, the same salary earns very different leave pay.
Mid-pack on the weekly number. First in the country on the total. Massachusetts pays a $1,230 weekly maximum — sixth of thirteen. But it pays for up to 26 weeks combined, more than any other state. Rhode Island, which has had a program since 2014, pays family leave for just seven. Depth of benefit, not the headline rate, is what decides whether a private plan is worth pricing — which is why the answer differs state by state.
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Massachusetts was not first. It was the one that raised the bar.
California has been paying family leave benefits since 2004, New Jersey since 2009. But those early programs were bolted onto temporary disability systems built in the 1940s, and the family leave piece was thin — California started at six weeks, Rhode Island at four. Massachusetts, Washington and D.C. were the first programs designed from scratch as unified family and medical leave. Massachusetts came out of that wave with the deepest entitlement in the country, and it still holds that position.
Where you can leave the state pool — and what it costs you to try.
Eleven of the thirteen jurisdictions now paying benefits will let you substitute an approved private plan. Two will not. Every one of the eleven has its own application, its own approval window, and its own way of tripping you up.
Approval runs one year and must be renewed. Since July 2026 requests and renewals go through the DFML Employer Portal, and the plan must be updated each year to the new $1,230.39 maximum.
Voluntary Plan must beat the state on at least one benefit, cost employees no more, and let any employee reject it. Opt out of one program and you opt out of both.
A majority of your Connecticut employees must vote to approve the plan before you apply. Approval lasts three years unless the plan materially changes.
Effectively private-first — most employers already satisfy PFL through a DBL carrier rider rather than a state fund.
Private plan election covers TDI and FLI. Employee-paid contributions cannot exceed the state rate.
Voluntary plans are approved per benefit type. Note the employer threshold dropped from 50 to 25 employees on January 1, 2026.
Called an "equivalent plan." Requires a $250 application fee and re-approval on a fixed cycle.
Private plan must be approved before the quarter begins, and you still file quarterly wage reports with FAMLI.
Equivalent Plan Substitution Request. Brand new for 2026 — approval timelines are still settling.
Private plans must be elected per coverage type. Benefits only began January 2026.
Called a "substitute plan." Approval is good for three years, then recertification. Benefits started May 2026.
No private plan substitution. TDI and TCI are state-administered, full stop. You contribute 1.1% and that is the end of it.
No opt-out. Also the only program funded entirely by the employer — 0.75% of wages, no employee share.
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How the exemption actually gets approved.
No state agency will approve a plan that is one dollar short or one day late. Here is the sequence we run for every client, in every state that allows an exemption. The specifics below are Massachusetts, because it is the strictest and the one most of our clients start with — the steps themselves are the same everywhere, with each state's own portal, deadline and renewal cycle swapped in.
Market the coverage
We quote your group with the carriers writing private PFML in each state you employ in, and price a self-insured option with a surety bond where headcount justifies it. You see every state's public rate and every private quote on one page.
Confirm the plan qualifies
The private plan must match or exceed every state benefit and protection — including the 2026 maximum of $1,230.39 per week, 12 weeks family, 20 weeks medical, 26 weeks combined, and job protection. No greater cost to employees than the state rate.
File through the Employer Portal
Since July 2026 exemption requests and renewals run through the DFML Employer Portal rather than the old MassTaxConnect flow. We prepare and submit the request, upload the policy or bond, and track it to approval.
Mind the quarterly deadline
Exemptions take effect at the start of a quarter and must be approved before it begins. Miss the window and you owe the state contribution for the entire quarter, even with a private policy already in force.
Notify your employees
Written notice of the private plan, the benefit amounts, and how to file a claim — with acknowledgements collected. We supply the notice and load it into Employee Navigator so it is captured and dated.
Renew on schedule
Approval periods differ by state — one year in Massachusetts, three in Connecticut and Maine, a fixed cycle in Oregon. Each renewal must reflect that year's new maximum weekly benefit. We calendar every one of them, update the plans, and refile. You do not have to remember any of it.
The plan lapses at renewal because nobody updated the maximum. When the state ceiling moved from $1,170.64 to $1,230.39 for 2026, every private plan had to move with it. A plan that still pays the old maximum is no longer equivalent, and the exemption fails on review — retroactively.
One remote hire can put you into a program you have never heard of.
Contributions follow where the work is localized, not where your office is. A Boston company that hires one engineer in Denver is now a Colorado FAMLI employer — registration, quarterly wage reports, employee notice, the whole apparatus. Hire in Minneapolis and Wilmington in the same year and you have picked up two more programs that only started paying benefits in 2026.
What we handle
- State-by-state cost comparison: private plan against each state pool
- Exemption applications, renewals, recertifications and portal filings
- One carrier and one renewal date across every state you employ in
- Coordination with your STD, LTD, FMLA and PTO policies so benefits do not stack wrongly
- Employee notices, acknowledgements and documentation in Employee Navigator
- A compliance calendar we own, so deadlines never reach you as a surprise
Why coordination matters more than the premium
- State PFML and FMLA run concurrently — but the FMLA substitution rule does not apply during PFML-paid weeks
- Some states let you integrate STD with the state benefit; others prohibit any reduction
- Getting the offset wrong means overpaying employees or underpaying them — waste or liability
- LTD elimination periods must account for the state program or you create a coverage gap
- Health premiums still have to be collected during leave, and the rules differ by state
PFML exemptions, answered plainly.
Does a private plan have to be insured, or can we self-insure?
Either, in most states. Massachusetts, like the majority of exemption states, allows a fully insured private plan or a self-insured plan backed by a surety bond. The bond amount scales with your covered workforce, which is usually what decides it — below a few hundred employees, an insured plan is generally simpler and lower-cost to carry.
If we get an exemption, do we still file anything with the state?
Yes. You are exempt from remitting contributions, not from the program. You still report wages, still provide notice, and still renew the exemption annually. Several other states, Colorado among them, keep you on quarterly wage reporting even with an approved private plan.
What happens if our exemption is denied or lapses?
You owe contributions back to the start of the quarter, plus interest. This is why the quarterly approval deadline matters more than the policy effective date — having coverage in force is not the same as having an approved exemption.
We have employees in Massachusetts and three other states. Can one carrier cover all of them?
Usually, yes. The national disability carriers write multi-state statutory programs on a single case with one renewal date. That single administrator is often worth more than the premium difference — it is the difference between one renewal conversation a year and four.
Our workforce is small. Is this worth the effort?
Several states discount the rate for small employers — under 25 covered individuals in Massachusetts you pay 0.46% and owe no employer share, and Maine and Oregon have similar breaks. That is a low bar for a private plan to beat, and we will tell you plainly when it does not. Where small employers gain most is service and claims handling, not premium.
Massachusetts was not the first state to do this. Why does that matter?
Because the early programs — California, New Jersey, Rhode Island — were built on 1940s temporary disability systems and their family leave benefits stayed thin. Massachusetts designed its program from scratch in 2018 with family and medical leave together and up to 26 weeks combined. More generous benefit means more premium at stake — which is exactly why the private-plan analysis pays off in some states and not others, and why it has to be run state by state rather than assumed.
Go straight to the primary sources.
Let's find out whether you are overpaying.
Send us your census and the states you employ in. We come back with the public rate and every private quote side by side, for each program you are in. Where the state pool is the better deal, we will say so.
Waugh Agency, LLC · 22 Bateson Drive, Andover, MA 01810
Figures reflect 2026 published state rates and maximums and change annually; several programs began paying benefits in 2026 and continue to issue guidance. This page is general educational information for employers, not legal, tax, or insurance advice for a specific situation. Waugh Agency, LLC is an independent insurance agency and an Employee Navigator License Holder, not affiliated with Employee Navigator. Charts and analysis © 2026 Waugh Agency, LLC — reproduction without attribution is prohibited.