New Jersey Department of Labor and Workforce Development

1. New JerseyDepartmentofLabor and Workforce Development Division of Temporary Disability Insurance

2. Disability Coverage • Rhode Island • California • New Jersey • New York • Hawaii • Puerto Rico

3. New Jersey Program • Established in 1948 • Modeled After California & Rhode Island • Compromise Between Business & Labor • Business – Private Coverage • Labor – State Coverage

4. Temporary - Short Term Benefits Disability - Non-Work Related Illness or Injury Insurance - Protection What is Temporary Disability Insurance?

5. Who is Covered? All Those Covered for Unemployement Insurance With the Following Exceptions: Local Government (Optional) Federal Government Out-of-State Employment

6. The Division of Temporary Disability Insurance Oversees Three Programs: • State Plan • Private Plan • Disability During Unemployment • Disabilities beginning more than 14 days after the last date of work in covered employment

7. State Plan Operations

8. State Plan Eligibility • Covered Wages in Base Year • Base Week Requirement • 2014 = $145* • Alternative Earnings Test • 2014 = $7,300* • Unable to Work • Medical Certification

9. Benefit Calculation • Benefit Calculation • 2/3 of the Average Weekly Wage • Average Weekly Wage is based on earnings in the 8 calendar weeks immediately prior to start of disability • Weekly Benefit Rate • 2014 = $595 • Maximum Entitlement • 2014 = $15,470

10. Claims Processing Goals • 69% of claims determined within 14 days. • 88% of claims determined within 28 days. *To avoid processing delays, the application form should be completed by the claimant, the doctor, and the employer.

11. Benefit Limitations • Waiting Week • Criminal Acts • Gross Misconduct • Workers’ Compensation • Labor Disputes

12. Special Issues • Pregnancy • Drug Abuse • Alcohol Abuse

13. Protection of the Trust Fund • Independent Medical Examinations • Staff Physician • Cross-match With Unemployment Insurance

14. Benefit Charges • Are Determined by Most Recent Covered Employer • Federal Tax Requirements • Since 1982, TDI Third Party Pay • Taxable Under FIT & FICA • FICA Deducted From Benefits • Year End Statement Sent to Employer for (W2) preparation Not taxable for NJ State Income Tax

15. Employer Rates Start-up Rate = 0.0050% Experience Rating After Three Years = 0.10% to 0.75% 2014 Contributions = $31.50 to $236.25 Worker Rate .0036% on the first $31,500 2014 Max. Employee Contributions = $119.70 State Plan Funding Based on Taxable Wages 2014 Taxable Wage Base = $31,500

16. Private Plan,Disability During Unemployment&Customer Services

17. Coverage Options State Plan Coverage Is Automatic for Most Workers But Workers May Be Covered by an Employer’s Approved Private Plan Instead.

18. Private Plan Coverage • Approximately 6,100 Private Plans • Covering Approximately 905,000 workers • State Plan oversees the administration of all private plans • Supplemental Plans permitted on voluntary basis

19. Third TDI Program Disability During Unemployment • Disability Begins More Than 14 Days After Last Day of Covered Employment. • Eligibility Same As U.I. (But Unable to Do Any Work).

20. Federal Tax Requirements • Not Subject to FICA • Considered Income by IRS • New Jersey LWD Sends Form 1099G to Claimant for Tax Year Note: Not taxable for NJ State Income Tax

21. Claims Processing • Claims come in through fax or mail and are sorted and imaged into our system • Our mainframe system randomly assigns the claim to an examiner, and when all 3 parts of the claim have been received, the examiner processes that claim within 14 days and a determination of eligibility is sent to the claimant

22. Claims Processing • If more information is needed, the examiner will contact the claimant, doctor, or employer via phone or mail to request the information • Payments for eligible claims are made via a Bank of America debit card which is mailed to the claimant and is valid for all UI, TDI, and FLI benefits paid for 4 years

23. Customer Service Section609-292-7060 • 20 - 30 Agents who have the ability to view claim images • Conversant System for inquiry • 50,000 Conversant Calls Per Week • 7,000 Agent Calls Per Week

24. Temporary Disability InsuranceWebsite www.nj.gov/labor Go to Temporary Disability • Provides general information on all three program areas • Ability to download claim form (DS-1) • Claimants can access State Plan claim information via Web Services link • Ability to contact the Division via e-mail. • Claim specific information not available via e-mail due to security issues • Ability to file an appeal via e-mail • We are creating a web based application expected to launch late this year

25. Appeals • State Plan • Disability During Unemployment • Private Plan

26. Questions?

27. FAMILY LEAVE INSURANCE Department of Labor and Workforce Development Division of Temporary Disability Insurance

28. GENERAL INFORMATION • Signed into law May 2, 2008 • Claim filing began July 1, 2009 • care of a seriously ill family member • bonding with a newborn or newly adopted child.

29. GENERAL INFORMATION • 2nd State to implement Family Leave Insurance • California (2004) • Washington (delayed 2015) • FLI is a benefit entitlement program not a leave entitlement program • No employment protection provision to hold job. Employees may have rights under other laws including NJFLA and FMLA

30. COVERAGE • Workers covered under the New Jersey Unemployment Compensation Law, including government entities • All businesses, regardless of the size • Employees may be covered under: • the State Plan or an approved Private Plan • Family Leave During Unemployment (leave begins more than 14 days after the last day of work) • Information regarding the type of coverage provided by an employer must be posted at the worksite

31. PROGRAM FUNDING • 100% funded by employee contributions through payroll deductions • No employer contributions • New tax rate for 2014 is 0.001% of taxable wage base. Varies annually based on fund balance, claim activity and administrative costs. • The taxable wage base changes each year. In 2014 the taxable wage base is $31,500. The maximum contribution in 2014 is $31.50

32. CARE OF A FAMILY MEMBER • Benefits are payable for care of a family member with a serious health condition supported by a certification provided by a health care provider • Family Member • child (biological, adopted, foster, stepchild, legal ward of a covered individual, child of a domestic/civil union partner who is less than 19 years or age or over 19 and incapable of self care) • spouse • domestic/civil union partner • parent (biological, foster, adoptive, stepparent or legal guardian) • Claims may be filed for6 consecutive weeks, Intermittent weeks or 42 intermittent days

33. BONDING • Benefits are payable for bonding with a newborn or newly adopted child during the first 12 months after the birth or adoption • Claim must be for: • Continuous period greater than seven days • Non consecutive periods greater than seven days if permitted by the employer

34. FAMILY LEAVE INSURANCE FACTS • An employer can require an employee to use up to two weeks of paid time off (State of NJ requires) • The maximum allowance may be reduced by up to two weeks of any paid time off if the employer requests the reduction • Claimant must give the employer notice of family leave • care of family member • reasonable and practicable notice unless time of leave is unexpected or unforeseeable. • 15 days for leave on an intermittent basis • bonding • 30 days notice

35. FAMILY LEAVE INSURANCE FACTS • A formal appeal can be filed by an employee or employer who disagrees with a determination • The maximum payable is 6 weeks of benefits in a 12 month period. The 12 month period is the 365 consecutive days beginning with the first day a claim is established

36. STATE PLAN COVERAGE

37. STATE PLAN ELIGIBILITY • Covered Wages in Base Year • Base Week Requirement 2014 – 20 weeks with earnings of $145or more • Alternative Earnings Test2014 - $7,300 during the base year period. • Base Year is the 52 weeks immediately prior to the week in which the family leave claim begins

38. BENEFIT DURATION • 6 Weeks during a 12 month period (365 consecutive days beginning with the first day of a valid first claim) • First Claim is the claim for Family Leave Insurance benefits initially filed. It begins the running of the 12 month period

39. BENEFIT CALCULATION • Weekly Benefit Rate • 2/3 of the Average Weekly Wage up to the maximum weekly benefit rate. The maximum WBR for 2014 is $595 • Average Weekly Wage is based on earnings in the 8 calendar weeks immediately prior to start of family leave • Weekly Benefits Rate will be the same as for State Plan temporary disability claim if family leave claim is filed immediately after the State Plan temporary disability claim • Daily Rate • 1/7 of the weekly benefit rate

40. Benefit Limitations • Waiting Week (no waiting week if the State Plan Family Leave Insurance Claim is immediately after the State Plan temporary disability insurance claim) • Pensions reduce entitlement, dollar for dollar, if the most recent employer contributed to the pension benefit

41. OTHER BENEFIT PROVISIONS • No benefits are payable if: • Receiving Temporary Disability Benefits • Receiving Workers’ Compensation Benefits • Receiving benefits from a disability or cash sickness program or similar law of any state or the federal government. • Receiving Unemployment Benefits • Receiving Full Paid Time Off • Working

42. OTHER BENEFIT PROVISIONS • No benefits are payable if: • not in covered employer within 14 days of the last day worked • not under the care of a health care provider • involved in a Labor Dispute • discharged for Gross Misconduct • employee of an educational institution and benefits are claimed between academic year or terms or during a school-wide recess when claimant has a reasonable assurance of returning to work

43. Tax Information • Subject to Federal Income Tax • Claimant can request that 10% of weekly benefits rate be withheld • Not Subject To: • FICA • State Income Tax • 1099G mailed to claimant by Division

44. Program statistics • 211,560 eligible claims since 7-1-2009 • Bonding claims 81% • Care claims 19% • 7.5% claimants work for State of NJ • 21% of claims PTO reduction • 77% claims determined in 14 days or less • 91% approval rate

45. Program statistics • Volume running below original OLS estimates • 22% of bonding claims processed through web center automation

46. Program challenges • Intermittent FLI care & bonding claims • Confusion with FMLA & NJ FLA • Early claim submission • Paid Time Off reduction • Integration with Private Plan TDI carriers • Adoption & custody issues • Claims from employees of educational institutions

47. Ineligible claims • Intermittent bonding • Invalid relationships • School employees during school wide recess • Typical reasons (insufficient wages, failure to provide information, etc.)

48. APPLYING FOR BENEFITS • Application can be obtained: • by writing to the Division of Temporary Disability Insurance, PO Box 387, Trenton, NJ 08625-0387 • telephoning Customer Service Section 609-292-7060 • website – www.nj.gov/labor • Claimants who receive State Plan temporary disability benefits will receive instructions after giving birth for filing a transitional bonding claim • Applications should not be filed until the family leave period begins

49. CUSTOMER SERVICE • Conversant System for general topics and claim specific information is now available • Agent Assistance – during business hours 609-292-7060 • Website www.nj.gov/labor • Contains general program information • Applications and informational pamphlets can be downloaded • Claimants can view State Plan claim details or file a transitional bonding claim via the Web Services link.

50. Questions?