Colorado Family and Medical Leave Compliance in NetSuite 2026.1

TL;DR Opening

Starting in NetSuite 2026.1, the platform introduces support for the Colorado Family and Medical Leave Insurance (FAMLI) program. This new feature enables employers to efficiently manage state-mandated contributions for Paid Family and Medical Leave (PFML), ensuring compliance with Colorado’s legal requirements.

What's New

NetSuite has expanded its payroll capabilities with the incorporation of Colorado’s FAMLI program. This initiative ensures that employees in Colorado can access wage replacement benefits when taking time off for family or medical reasons. All employers with employees working in Colorado must adhere to the state's PFML compliance requirements, either by withholding premiums from employee paychecks or covering these premiums themselves.

How to Set Up PFML in NetSuite

To effectively manage PFML contributions in NetSuite, employers can take the following steps:

• Set Up Payroll Information: Update your payroll details to make the PFML contribution codes available. Go to Setup > Payroll > Update Payroll Information to commit changes.
• Define Contribution Rates: You can set company-level or employee-level PFML contribution rates according to state requirements.
• Manage Exemptions: Employers can exempt themselves or individual employees from PFML contributions if the contributions do not apply.
• Override Contributions: If needed, you can override the default PFML contribution rates for employees in states with specific regulations.
• Reclassification of Employees: Employees earning in different states can be reclassified for PFML contributions ensuring accurate compliance.

Colorado Specifics

In Colorado, the following FAMLI contribution rates can be configured in NetSuite:

• CO FAMLI Premium (Employee): This represents the employee-paid family leave contribution.
• CO FAMLI Premium (Employer): This indicates the employer-paid family leave contribution.

Key Actions for Compliance

• Ensure accurate setup of both employee and employer contribution rates for Colorado's FAMLI in NetSuite to avoid compliance issues.
• Regularly review payroll setups for in-state and out-of-state employees under PFML guidelines.

Who This Affects

• Administrators: Responsible for payroll set-up and compliance.
• HR Professionals: Manage employee records and contributions.
• Payroll Managers: Oversee payroll processing aligned with state requirements.

Key Takeaways

• NetSuite 2026.1 supports Colorado's PFML contributions, helping employers stay compliant with state laws.
• Employers have flexibility in choosing to withhold or cover PFML premiums.
• Regular updates and reviews of payroll systems in NetSuite are essential for ongoing compliance.
• Contribution setup can be managed at both company and employee levels, providing tailored approaches based on state requirements.