Implementation, Benefits, and Payroll Tax Exemptions in Oracle Cloud Payroll

Delaware has enacted the Healthy Delaware Families Act, establishing a Paid Family and Medical Leave (PFML) insurance program to support employees during significant life events. Here’s an overview of the key aspects:

Implementation Timeline:

• January 1, 2025: Employers begin making payroll-linked contributions to the state-run leave-benefits fund.
• January 1, 2026: Eligible employees can start applying for paid leave benefits.

Eligibility and Coverage:

• Covered Employers: Employers with 10 or more employees in Delaware are required to participate. Those with fewer than 10 employees are exempt but may opt in voluntarily.

laborfiles.delaware.gov

• Covered Employees: Employees who have worked for their employer for at least 12 months and have logged a minimum of 1,250 hours in the preceding year are eligible for leave.

Types of Leave and Duration:

1. Parental Leave: Up to 12 weeks per year for activities related to the birth, adoption, or placement of a child.
2. Medical Leave: Up to 6 weeks in a 24-month period for the employee’s own serious health condition.
3. Family Caregiver Leave: Up to 6 weeks in a 24-month period to care for a family member with a serious health condition.
4. Military Exigency Leave: Up to 6 weeks in a 24-month period for matters arising from a family member’s military service.

Benefit Details:

• Compensation Rate: Employees receive 80% of their average weekly wages, capped at $900 per week. This maximum benefit is subject to annual adjustments based on inflation.

laborfiles.delaware.gov

Funding Mechanism:

• Contribution Rate: The program is funded by a 0.8% payroll tax on employees’ wages. Employers can require employees to contribute up to 50% of this tax (i.e., 0.4% of wages). Employers are responsible for the remaining portion.

laborfiles.delaware.gov

Job Protection:

• Employees who utilize PFML are entitled to job protection, ensuring they can return to their same or an equivalent position upon completion of their leave.

Coordination with Other Leave Policies:

• PFML benefits are designed to run concurrently with the federal Family and Medical Leave Act (FMLA) and any employer-provided leave programs. Employers may require employees to use up to 75% of their accrued paid time off (PTO) before accessing PFML benefits.

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For comprehensive details, employers and employees should consult the Delaware Department of Labor’s resources on the PFML program.

labor.delaware.gov

Understanding these provisions will help both employers and employees navigate the new requirements and benefits associated with Delaware’s Paid Family and Medical Leave program.

How to Opt Out Your Organization from Taxes in Oracle Cloud Payroll

Overview

Organizations can opt out of employee and employer components of specific taxes in Oracle Cloud Payroll by configuring the appropriate settings at either the PSU (Payroll Statutory Unit) level or TRU (Tax Reporting Unit) level.

Steps to Opt Out

1. Determine the Level of Opt-Out

• PSU Level: Start the Legal Entity Calculation Cards task from your implementation project.
• TRU Level: Start the Legal Reporting Unit Calculation Cards task.
• Note: Settings applied at the TRU level override those at the PSU level.

2. Open and Edit the Calculation Card

• Navigate to the Calculation Card for the relevant entity.
• Select Edit to modify the settings.

3. Configure the Tax Exemption

1. In Component Groups, select Delaware.
2. Under Calculation Components, choose State FLI (Family Leave Insurance).
3. If State FLI does not exist, create it.

4. Set the Enterable Calculation Values

• Select Enterable Calculation Values on Calculation Cards.
• Search for and select the relevant tax exemption calculation value:
  • FLI Employee Tax Exemption
  • FLI Employer Tax Exemption
  • MLI Employee Tax Exemption
  • MLI Employer Tax Exemption
  • PLI Employee Tax Exemption
  • PLI Employer Tax Exemption

5. Assign the Exemption Status

• In the Value field, select the appropriate exemption status.

Conclusion

Following these steps ensures that your organization is correctly opted out of the employee and employer tax components within Oracle Cloud Payroll. Proper configuration ensures compliance with organizational payroll policies and tax regulations.