If you employ even one person in Maryland, your part of the state's new paid leave program begins well before your first payroll of 2027. Registration is already open, and employers considering a private plan must act between September 1 and November 15 of this year. Because benefits will not be available until 2028, many employers assume they have more time and miss the requirements that land in 2026.
Maryland's Family and Medical Leave Insurance (FAMLI) program will give eligible employees paid, job-protected leave for certain family and medical reasons starting January 1, 2028. If your business has at least one employee working in Maryland, you must register for the program before January 1, 2027, when payroll deductions begin. There are no exceptions under state law. Only an Authorized Officer of the business can complete that registration. Your CPA firm cannot do it for you, and neither can your payroll company.
Starting in 2028, eligible employees may receive up to 12 weeks of paid leave each year, with benefits of up to $1,000 per week.
Eligibility depends on hours worked, not on length of employment or salary. An employee qualifies after working at least 680 hours in a position localized in Maryland during the four calendar quarters reported before the claim is filed or the leave begins. Localization turns on where the work is physically performed, not on where the employee lives or where the employer is based.
Employees may qualify for leave to:
FAMLI is funded by contributions from employers and employees. The Maryland Department of Labor set the initial rate at 0.9% of wages up to the Social Security wage base, applied to wages paid from January 1 through December 31, 2027. The rate is capped by statute at 1.2%, and MD Labor will announce each following year's rate the preceding November.
For employers with 15 or more employees:
For example, an employee earning $50,000 per year would have $225 withheld from their paycheck during the year. The employer would contribute another $225, for a total annual contribution of $450.
A small employer remits half the total rate, 0.45%, and may withhold that amount from employee pay. There is no separate employer share on top of it. All other requirements, including registration and quarterly reporting, apply in full.
Employers routinely undercount. FAMLI counts every employee under the same federal EIN, in Maryland and out of it, toward a single employer size. Independent contractors do not count. Through 2027, the test is run each quarter based on your Quarterly Wage and Hour Report; from 2028, it is the average of the previous four quarters. A twelve-person Maryland operation that shares an EIN with staff in another state can be over fifteen without ever having fifteen people in Maryland.
Registering automatically enrolls you in the State Plan. An employer that would rather use a FAMLI-approved private plan, either commercial or self-insured at 50 or more employees, and wants to be exempt from remitting contributions during the 2027 seeding year, has to file a Declaration of Intent between September 1 and November 15, 2026.
The Declaration is not a form you can complete the night before. It requires a Proof of Private Plan Consultation signed by a licensed Maryland insurance agent, it must be filed by an Authorized Officer, and it takes a separate filing for each EIN. An accepted Declaration does not stop the withholding: you still collect from employees beginning January 2027, but you hold the money in escrow rather than sending it to the State, and you must apply for the private plan itself by October 1, 2027.
Choosing a private plan is difficult to reverse without financial consequences. An employer that leaves an approved private plan for the State Plan during 2028 owes contributions back to January 1, 2027 with interest; leaving during 2029 costs half of that, again with interest. The narrow exception that let employers under 50 employees self-insure required a FAMLI-compliant plan already in place by July 31, 2026. That door has closed.
All employers with at least one Maryland employee must:
The first quarterly filing and payment will be due April 30, 2027, covering wages paid January 1 through March 31. Each quarter after that is due on the last day of the following month: July 31, October 31, and January 31.
Most Maryland employers with a single location and a single payroll will find FAMLI mechanical. The firm's partnerships, management companies, and multi-state employers will not, for three reasons.
A CPA firm, payroll company, or other third-party provider can help with FAMLI reporting and compliance. However, the employer must complete the initial registration. The mechanics run in the other direction from what most people assume: your provider must first register with FAMLI as a Third-Party Agent, then send you an invitation, and your Authorized Officer signs a Power of Attorney within 14 days. Miss the 14 days and the invitation has to be reissued. Once it is signed, the agent can file your quarterly reports, remit contributions and respond to claims.
If you have a payroll provider, we suggest you contact them now and get two things in writing: the date their Maryland FAMLI withholding code goes live, and whether they intend to file the Quarterly Wage and Hour Report or leave it with you.
If you need assistance or have questions, please reach out to our office to speak to a team member.
Sources: Maryland Department of Labor, FAMLI Division: About the Program, For Employers, Make Contributions, Understand Employer Registration, Understand Your Plan, and Manage FAMLI for Clients, all accessed August 31, 2026 (paidleave.maryland.gov); FAMLI FAQs, April 2026; COMAR 09.42.
This article is provided for general informational purposes only and does not constitute tax, legal, or accounting advice. It should not be relied upon as a substitute for consultation with a qualified professional regarding your specific circumstances and was prepared by KMAF with the assistance of AI-powered editing tools.
