Delaware Modifies its Paid Family and Medical Leave Program

Delaware has enacted HB 128 (“the Act”), which modifies the state’s upcoming paid family medical leave program (“Delaware Paid Leave”) before benefits become available on January 1, 2026. The Act became effective immediately upon enactment on July 30, 2025. 

The Act significantly amends the provisions governing how an employer’s paid leave policies integrate with and coordinate with Delaware Paid Leave benefits. First, the Act provides that Delaware Paid Leave is the primary payor of benefits. As such, an employer’s disability insurance benefits may be offset by Delaware Paid Leave, per the terms of the disability policy. Other available income replacement benefits must be coordinated with Delaware Paid Leave benefits according to the terms of the policy or procedure governing other available benefits. 

Second, the Act rescinds a provision that allowed an employer to require an employee to use accrued paid time off before accessing Delaware Paid Leave benefits. Instead, the law now provides that an employer may not require use of accrued paid time off prior to receipt of Delaware Paid Leave benefits. The Act also confirms that use of accrued paid time off to “top off” or supplement Delaware Paid Leave benefits requires both the employer and employee to agree to the top off. 

Private plans are also impacted by the Act. Like many other paid family medical leave programs, employers may satisfy their obligations to comply with Delaware Paid Leave through a private plan. Prior to the passage of the Act, employers were required to apply for and renew private plans between September 1 and December 1 of each year. The Delaware Department of Labor is now required to accept applications for approval of an employer’s use of a private plan on a rolling basis, with effective dates of January 1, April 1, July 1, or October 1. Employers with self-insured private plans may begin collecting contributions as of July 30, 2025. Although there are fewer requirements imposed on employers with fewer than 25 employees in Delaware, if an employer with fewer than 25 employees in Delaware with a private plan voluntarily elects to provide coverage for any reason that is not required by the law, all the provisions of the law will be applied as if the employer were a covered employer. Finally, employers with private plans no longer need to provide claim documentation to the Department, unless there is an appeal, complaint, audit, or specific inquiry from the Department.

Beyond the substantive changes noted above, the Act also sets forth procedures for the Department to execute upon judgments for penalties issued under the program, including warrants for levy and sale of property, and garnishment of bank accounts and wages. 

If they have not already done so, multi-state employers should start focusing on the state paid family medical leave programs in three states that will start providing benefits over the next nine months to ensure that their policies are up-to-date and they have provided employees with necessary notice of their rights under the program. As a reminder, both Delaware and Minnesota will begin providing paid family and medical leave benefits to employees on January 1, 2026, and Maine will begin providing benefits to employees on May 1, 2026. We will continue to provide updates on these programs as we get closer to those program launch dates.