Colorado Adjusts Rules for Paid Family and Medical Leave

Quick Hits

• Colorado lawmakers amended the FAMLI program to provide an additional twelve weeks of paid leave for employees to care for a child in neonatal intensive care.
• The premium payments for FAMLI will decrease to 0.88 percent of a worker’s wages in 2026.
• These changes will take effect on January 1, 2026.

Under Colorado’s FAMLI program, employers started paying premiums in 2023, and employees were eligible for FAMLI leave in 2024. Employees can take up to twelve weeks of paid FAMLI leave per year, with an additional four weeks for employees with a serious health condition related to pregnancy complications or childbirth complications.

On May 30, 2025, Colorado enacted Senate Bill 25-144, which takes effect on January 1, 2026. This law amended the FAMLI program by:

• expanding FAMLI to allow eligible employees to take up to twelve weeks of paid FAMLI leave to care for a neonatal intensive care unit (NICU) patient; and
• reducing the FAMLI premium from 0.9 percent of an employee’s wages to 0.88 percent for 2026. For 2027 and each year thereafter, the state’s FAMLI director will set the premium rate annually. 

Neonatal care coverage is in addition to other leave that may be available under FAMLI. However, neonatal care leave is limited to twelve weeks of leave per infant.

Employers may deduct 50 percent of the required premium from employees’ wages. Employers with fewer than ten employees may deduct 50 percent of the required premium from the employees’ wages and are not required to make a matching contribution. Employers must submit premiums to the state FAMLI Division on a quarterly basis.

The state average weekly wage for the purposes of FAMLI benefits is $1,534.94. The current maximum weekly benefit amount is 90 percent of the state average weekly wage, which equals $1,381.45. Any part of the worker’s average weekly wage less than 50 percent of the state average weekly wage ($767.47) must be replaced at a rate of 90 percent. The rest of the worker’s average weekly wage must be replaced at a rate of 50 percent, up to the maximum benefit.

All private sector Colorado employers that employ at least one employee in Colorado or that paid wages of $1,500 during one quarter in the preceding year must participate in the FAMLI program by providing paid family and medical leave. FAMLI permits employers to provide approved private plans that offer all the same rights, protections, and benefits provided to employees by the FAMLI Act.

Next Steps

The new rules will apply to premium payments and leave requests that occur after January 1, 2026. Employers may wish to coordinate with their third-party payroll vendor to ensure that the correct amount is deducted from each employee’s wages. Employers can use the My FAMLI+ Employer portal to submit quarterly premiums.

Ogletree Deakins will continue to monitor developments and will provide updates on the Colorado, Healthcare, and Leaves of Absence blogs as new information becomes available.

In addition, the Ogletree Deakins Client Portal also covers developments in Leave laws and Colorado laws, including Colorado Family and Medical leave. Premium and Advanced subscribers have access to policy templates, including a recently updated Colorado Paid Family and Medical Insurance (FAMLI) Handbook Policy template. All client-users have access to updates. For more information on the Client Portal or a Client Portal subscription, please reach out to clientportal@ogletree.com.

David L. Zwisler is a shareholder in Ogletree Deakins’ Denver office.

This article was co-authored by Leah J. Shepherd, who is a writer in Ogletree Deakins’ Washington, D.C., office.

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