Background

Starting January 1, 2023, Colorado has implemented its Family and Medical Leave Insurance Program (FAMLI).

Employers and their employees are both responsible for funding the program and may split the cost 50/50. The premiums are set to 0.9% of the employee’s wage, with 0.45% paid by the employer and 0.45% paid by the employee.

Businesses with nine or fewer employees do not have to contribute to the program but do need to remit their employees' share (0.45%) of the premium on behalf of employees each quarter. This can be done through a simple payroll deduction. Employers are required to begin these premium deductions on January 1, 2023.

Most Colorado businesses will need to begin deducting FAMLI premiums from all employees on their payroll, including full-time, part-time and seasonal. Employers cannot collect missed premiums from employees in later pay periods. It is important to know employees are never required to pay more than 50% of the total premium.

For more full detailed information on Colorado's Family and Medical Leave Insurance Program (FAMLI) please the state website for employers.

AccountEdge Setup

Employee Responsibility

All employers must collect the employees' share (0.45%) of the Colorado Paid Family Leave premium. The Colorado Paid Family Leave tax is automatically applied to all Colorado employees and updated as needed with new tax table releases.

Employer Responsibility

If you are required to contribute to the program, this will be handled through an Employer Expense.   The PFML - CO Employer Expense is automatically created.  The wage limit will be automatically updated, but you must set your PFML rate based on your employee count (refer to the details below).

Set Up Colorado PFML Employer Expense

Go to Payroll > Payroll Categories > Expenses

• Select the PFML - CO Employer Expense and click Edit.
• The 2025 Employer PFML Rate is 0.45% and the Wage Limit is $176,100.00.
• The 2024 Employer PFML Rate is 0.45% and the Wage Limit is $168,600.00.
• Enter the appropriate PFML Rate based on the number of employees you have.  (0.0% if you have less than 10 employees or 0.45% if you have 10 or more Employees).
• Click the Employee button to add PFML - CO to all Colorado Employees.