Resources/State and Provincial Leave Management Programs

Colorado FAMLI Expands for NICU Parents, Lowers 2026 Premiums

Published: 3 min read

By: HUB's Absence Management Team

Overview

On April 19, 2025, Colorado Governor Jared Polis signed Senate Bill 25-144 into law, significantly expanding Colorado's Family and Medical Leave Insurance (FAMLI) program. The amended provisions take effect on January 1, 2026. This update outlines the bill's impact on employer obligations, changes to premium rates, and next steps for compliance.

Key Changes to Colorado Famli Program

Extended Leave for NICU Parents

Current law: Colorado's FAMLI program provides eligible employees with up to 12 weeks of paid family and medical leave per benefit year for qualifying reasons, including bonding with a new child.

Amended law: SB 25-144 provides a significant extension specifically for parents of infants requiring neonatal intensive care:

  • Parents of infants in the neonatal intensive care unit (NICU) will be eligible for an additional 12 weeks of paid leave
  • This extension is on top of the existing 12 weeks of leave
  • Eligible parents can receive up to 24 total weeks of paid leave in a benefit year
  • The additional NICU leave must be used within the first year after birth

Documentation Requirements for NICU Leave

Amended law: To qualify for the additional NICU leave, employees must provide:

  • Medical documentation confirming the infant's admission to a NICU
  • Certification from a healthcare provider regarding the duration of NICU care
  • Additional documentation as may be required by the Division of Family and Medical Leave Insurance

Premium Rate Reduction

Current law: For 2025, the premium rate is 0.9% of wages, shared between employers (0.45%) and employees (0.45%).

Amended law: SB 25-144 reduces the premium rate for 2026:

  • New 2026 premium rate lowered to 0.88% of wages, shared between employers (0.44%) and employees (0.44%)
  • Small employers (fewer than 10 employees) remain exempt from the employer portion

Job Protection During Extended Leave

Current law: Job protection applies to FAMLI leave for employers with 10+ employees.

Amended law: The same job protection provisions extend to the additional NICU leave:

  • Employers with 10+ employees must restore employees to the same or equivalent position following leave
  • Health benefits must be maintained during the entire leave period, including the additional NICU leave
  • All anti-retaliation provisions apply to the extended leave period

Next Steps for Employers

Immediate Actions (2025)

  • Assess Impact: Evaluate how the extended NICU leave may affect staffing and operations
  • Budget Planning: Adjust payroll budgets to account for the reduced premium rate for 2026
  • Policy Review: Begin updating employee handbooks and leave policies to incorporate the NICU leave extension

Pre-Implementation Activities (By December 2025)

  • Update Written Policies: Revise FAMLI leave policies to include the additional NICU leave provisions
  • Train HR Personnel: Ensure your HR team understands:
    • The extended leave entitlement for NICU parents
    • Documentation requirements for NICU leave
    • The reduced premium rate and its impact on payroll
  • Develop Notice Templates: Create or update written notices informing employees about the extended NICU leave benefit
  • Update Payroll Systems: Adjust systems to implement the reduced premium rate effective January 1, 2026
  • Review Leave Administration Systems: Ensure systems can track and manage the extended leave periods

Post-Implementation Activities (January 2026 onward)

  • Distribute Updated Notices: Provide all employees with information about the extended NICU leave benefit
  • Implement Rate Reduction: Apply the reduced premium rate in payroll processing
  • Monitor Compliance: Conduct regular audits of your FAMLI administration processes
  • Document Everything: Maintain thorough records of all notices provided to employees and leave taken
  • Stay Informed: Watch for regulatory guidance or clarifications from the Colorado Division of Family and Medical Leave Insurance

Additional Considerations

  • This expanded benefit applies to all Colorado employers covered by the FAMLI program
  • Multi-state employers should review how this program interacts with other state paid family leave programs
  • Consider providing specialized training to managers on handling extended leave requests compassionately
  • Private plans must be updated to include the extended NICU leave benefit and lower maximum employee contribution amount (0.44% of wages) to maintain equivalency

Additional Resources

For more information regarding Colorado's FAMLI program and Senate Bill 25-144, visit:

If you have any questions, please contact your HUB Advisor. We will continue to monitor and provide updates as more information becomes available. View more Workforce Absence Management updates in our WAM Bulletins page.

Notice of Disclaimer
Neither Hub International Limited nor any of its affiliated companies is a law or accounting firm, and therefore they cannot provide legal or tax advice. The information herein is provided for general information only and is not intended to constitute legal or tax advice as to an organization’s specific circumstances. You should consult an attorney, accountant, or other legal or tax professional regarding the application of the general information provided here to your organization’s specific situation in light of your organization’s particular needs.