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Employers will collectively see a $20 million reduction in their Temporary Disability Insurance (TDI) contributions for workers covered under the state plan in 2023, the Department of Labor & Workforce Development announced on Friday.

Temporary Disability Insurance provides cash benefits for up to 26 weeks to employees who cannot work due to a serious health condition unrelated to their job. Employers can participate in the state’s TDI plan or choose one offered by a private insurance company.

Both employers and employees contribute to TDI coverage. Employees, too, will see a reduction in their TDI contribution rates, which will drop from 0.14% of the first $151,900 in wages to 0%. The DOL said that in practical terms this will save workers an average of $56.25.

Contribution rates are also declining for the state’s Family Leave insurance program, which provides paid time off to workers to bond with a new child or care for a family member. The program is funded 100% by worker payroll deductions, which will decrease from 0.14% of the first $151,900 in wages to 0.06%, for an average savings of $55.25.

TDI and Family Leave contribution rates have been declining over the past three years largely because of increasing fund balances. A 2019 law raised the level of wages subject to wage taxes effective Jan. 1, 2020, for workers covered under both programs to pay for enhanced benefits. The balances in both funds have grown because revenues are outpacing claims. Benefits that were paid to workers under federal pandemic-related unemployment insurance programs have also been a factor.

“While I’m glad our Temporary Disability and Family Leave funds are robust, thus resulting in a decrease to contribution rates, it also indicates that workers may be missing the opportunity to utilize these vital programs,” Labor Commissioner Robert Asaro-Angelo said on Friday.

“We’re working with our partners in the community to increase awareness of these critical resources, so workers know their rights and take the time they need and deserve to care for themselves and their families without risking their job or paycheck,” Asaro-Angelo said.

The recent change in the law increased TDI and Family Leave benefits from two-thirds to 85% of a worker’s average weekly salary, with a maximum benefit of $993 in 2022. Family Leave benefit time was doubled from six to 12 consecutive weeks per year and intermittent Family Leave time was increased from 42 days to 56 days.

Workers can use Family Leave to bond with a new child or to care for any loved one who is either blood-related or a family-like relation. Temporary Disability Insurance benefits are used for pregnancy, childbirth or a serious health condition. To qualify for either program, the applicant must have earned at least $240 per week for 20 base weeks or earned at least $12,000 during those base weeks.