The First PFML Cut: D.C. Rolls Back Paid Leave Benefits

Contributor: Sarah Hipp, Centro Absence Management Consultant

The D.C. Council recently finalized its new budget, which included impactful changes to the District’s Universal Paid Leave benefits as funds are redirected to other programs.

D.C. was an early adopter of paid leave mandates, enacting the Universal Paid Leave Amendment Act in 2017, with benefit payments going live in July 2020.  Since that time, seven additional states have begun paying benefits under similar mandates, with two more – Maryland and Virginia – set to launch in 2028.

Now, with the passing of the FY2027 budget, D.C. has become the first jurisdiction to roll back benefits in its paid leave program.

What This Means for Employees

Before detailing the upcoming reduction, it’s worth noting that the program had two prior expansions since the first payments went out in 2020, both lengthening the time available for employees to take leave for certain qualifying events.  Currently, D.C.’s Universal Paid Leave program provides private-sector employees up to 12 weeks of paid leave to bond with a new child, tend to their own serious medical condition, or care for an ill family member, plus two weeks of prenatal leave. These benefits are funded through a payroll tax paid entirely by employers, with no direct employee contribution.

D.C.’s Paid Leave Program Progression

Type of Leave	Launch 2020	1st Update 2021	2nd Update 2022	New Design 2026
Parental	8 weeks	8 weeks	12 weeks	12 weeks
Family Care	6 weeks	6 weeks	12 weeks	6 weeks
Medical	2 weeks	6 weeks	12 weeks	10 weeks
Prenatal	None	2 weeks	2 weeks	2 weeks

The D.C. Council’s passage of the FY2027 budget walks back some benefits from the latest expansion in 2022, but even with these revised benefits employees will receive equal or better benefits than the original 2020 design.

 Starting in October 2026, three key reductions go into effect for claims filed on or following that date:

• Family care leave decreases from 12 weeks to 6 weeks
• Medical leave decreases from 12 weeks to 10 weeks
• The maximum benefit amount drops from $1,190 to $1,100

Parental and prenatal leave remain unchanged. The program’s funding is also unchanged, with the 0.75% employer payroll tax holding steady.

Why This Matters for Employers

For employers operating in D.C., these changes will directly affect employees who use the paid leave program.  Employees who were planning leave for Q4 2026 or in 2027 will now receive less time and income replacement than they may have planned for, and they could be looking to their employer for resources to help cover the gap.

Even where the immediate impact is minimal, employers with DMV-based — D.C.-Maryland-Virginia — employees should note that this benefit-equity gap is likely to widen once all three programs are active in 2028.

This is exactly the kind of moment where employers turn to their benefit advisors for guidance. To help clients prepare for these changes, here are a few action items to consider:

• Prepare for employee communications and questions about these changes, especially for employees with upcoming leave planned
• Review supplemental policies, such as short-term disability or internal paid leave offerings, to ensure all benefit coordination provisions are updated and streamlined to account for the changes
• Update internal materials and handbooks to reflect the new benefit structure so employees are informed and equipped should they need to utilize the D.C. Universal Paid Leave benefits following October 1, 2026
• Assess the wholistic leave strategy and ways to broaden support for employees needing access to paid leave benefits

Centro’s Absence Management Consulting Team works with brokers to navigate state PFML programs, coordinate leave administration, and build leave strategies that work — for employers and the employees who depend on them.

For a recap of benefits in these upcoming states in the DMV — D.C.-Maryland-Virginia, see our previous posts: