Delaware Paid Family and Medical Leave Final Rules for 2026

As a reminder for employers in Delaware, on December 1, 2025, the state published final amendments to its Paid Family and Medical Leave (PFML) regulations.

The Delaware Department of Labor explained that the amendments were intended to improve consistency and predictability and to align regulations with recent statutory changes to the Healthy Delaware Families Act.

These amendments apply to private employers with 10 or more employees in Delaware, with mandatory coverage requirements varying by employer size. The amendments took effect on December 11, 2025, and PFML benefits became available on January 1, 2026.

What Employers Need to Do

• Update leave policies to state that the PFML “application year” is a 12-month period measured forward from the first day PFML is used, for both the state plan and approved private plans.

• Employers with 10 to 24 Delaware employees that voluntarily add non-mandatory lines of coverage should ensure payroll systems do not deduct employee contributions for those voluntary lines; the employer must fund 100% of those costs.

• Reassess eligibility using the wage location standard, under which an employee is covered if at least 60% of wages are earned in Delaware each quarter.

• Coordinate PFML and Family and Medical Leave Act (FMLA) tracking, since many will now administer two different leave year systems unless they change FMLA to the measured forward method.

Overview

• What Changed: The final rules require employers to use a measured‑forward application year, shift employee eligibility to a wage‑based test, and prohibit employee payroll deductions for voluntarily added coverage lines.

• Application Year: a 12-month period measured forward from the first day PFML is used, for both state and private plans.

• Employee Eligibility: coverage is based on where wages are earned; coverage applies if an employee earns at least 60% of wages in Delaware each quarter.

• Voluntary Coverage Contributions (Employers with 10–24 Employees): When voluntary lines are added, employee contributions cannot be deducted for those lines.

• Coverage Thresholds: Employers with 10-24 Delaware employees must provide parental leave only, while employers with 25 or more Delaware employees must provide all required Paid Family and Medical Leave coverage lines.

Why This Matters

• The measured forward application year can diverge from common FMLA leave year methods, increasing complexity for concurrency, administration, and audits unless FMLA is realigned.

• The 60% wage in Delaware test may change eligibility outcomes for remote, hybrid, or multi-state workers, increasing the importance of accurate payroll and location data.

• Small employers that voluntarily expand coverage face payroll compliance risk if employee deductions continue for voluntary lines that must be employer-funded.

• Compressed timelines require completed updates to policies, systems, and training by the December 11, 2025, effective date, and the January 1, 2026, benefits starting date.

Key Risks for Employers

• Incorrect leave year calculations may lead to under- or over-granting of PFML if measured forward rules are not applied distinctly from non-forward FMLA methods.

• Misapplication of the wage location test may cause erroneous eligibility decisions for remote and hybrid workers.

• Unlawful payroll deductions for voluntary lines among employers with 10–24 Delaware employees may require refunds and could trigger penalties.

Additional information

• Application Year (Benefit Tracking): The regulations now define the application year as the 12-month period measured forward under 29 CFR 825.200(b), applying to both the state plan and approved private plans.

• Employee Definition (Wage Location Test): The definition of employee focuses on where wages are earned; an individual is covered if at least 60% of wages are earned in Delaware each quarter, replacing a worksite location approach.

• Small Employer Voluntary Coverage and Contributions: Employers with 10-24 Delaware employees must provide parental leave only; if they voluntarily add medical, family caregiver, or qualifying exigency coverage, they may not deduct employee contributions for those voluntary lines and must fund 100% of those costs.

• Process and Intent: The Department finalized the rule after an October 1–31, 2025, comment period, citing goals of consistency, predictability, and alignment with recent statutory amendments.

• Enforcement and Program Context: PFML contributions began January 1, 2025, and benefits became available January 1, 2026; the Department of Labor provides program resources and FAQs for employers and employees. Employers with 10–24 employees are responsible only for parental leave, while those with 25 or more must provide all lines of coverage.

Source Reference

• Delaware Final Order – 1401 Rules Defining and Regulating the Healthy Delaware Families Act, Family and Medical Leave Insurance Program and the Division of Paid Leave

This communication is intended solely for the purpose of conveying information. The present post might incorporate hyperlinks directing readers to websites managed by third-party entities. The inclusion of any links within this communication is meant to serve as points of reference and could encompass opinion articles from various law firms, articles from HR associations, official websites, news releases, and documents of government agencies, and other relevant third-party sources. Vensure has no authority over these external websites and bears no responsibility for their content. Furthermore, Vensure does not endorse the materials present on these websites. The contents of this communication should not be interpreted as legal advice or as a legal standpoint concerning specific facts or scenarios. Nor should it be deemed an exhaustive compilation of facts potentially pertinent to federal, state, or local laws. It is strongly advised that employers solicit legal guidance from an employment attorney when undertaking actions in response to any legal updates provided. This is due to the possibility of future alterations occurring in federal, state, and local laws, regulations, as well as the directives and guidelines issued by governing agencies. These changes may transpire at any given time, potentially rendering certain portions of the content within this update void or inaccurate.