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Employers Need to Keep New Jersey’s Expansion of Temporary Disability Benefits in Mind

Last year, New Jersey lawmakers significantly expanded the state's temporary disability program.

The state recently announced the benefit schedule for 2021. If an employer with New Jersey-based employees elects to use the state’s temporary disability program rather than private coverage, they should know that effective January 1, 2021:

  • The benefit will be 85% of average weekly wages to a weekly maximum of $903 in 2021. (The weekly maximum is based upon 70% of the NJS Average Weekly Wage, which is expected to increase to $903 in 2021).
  • The employee contribution will increase from 0.26% to 0.47%. This increase represents an 81% increase from 2020 and a 276% increase since 2019.
  • The taxable wage base will increase from $134,900 to $138,200.
  • Keep in mind that the New Jersey Temporary Disability Benefits Law permits employers to cover their workers under private plans approved and monitored by the Division of Temporary Disability Insurance, Private Plan Compliance Section. Covered employers with approved private plans are relieved of employer contributions to the State Disability Benefits Fund, as are their workers, as long as coverage is continued under the plan.

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