FAMLI is Colorado's state-run paid family and medical leave insurance program, funded by a payroll premium that in 2026 is 0.88% of each employee's wages, split evenly: 0.44% paid by the employer and 0.44% by the employee, on wages up to the Social Security cap of $184,500.

Employers with fewer than 10 employees do not owe the employer share, they only collect and remit the employee half. Every Colorado employer participates regardless of size, and the most expensive misunderstandings are not about the premium at all, they are about what happens when someone actually takes leave. Here is what you owe, what your employees get, and where small employers get it wrong.

The premium math

For an employee earning $60,000, the total annual premium is $528: $264 withheld from the employee, $264 from you if you have 10 or more employees. A 15-person company with an average salary of $65,000 pays roughly $4,290 a year in employer share.

Employers may choose to cover the employee's portion as a benefit, some do as a recruiting point, but may never shift the employer share onto employees. Premiums are remitted quarterly through the My FAMLI+ Employer portal, and the 10-employee count is a nationwide headcount, not Colorado-only, another place multi-state employers miscount.

What employees actually get

Up to 12 weeks of paid leave per year (16 for pregnancy or childbirth complications) for their own serious health condition, bonding with a new child, caring for a family member, military family needs, or safe leave connected to domestic violence.

The wage replacement is progressive, lower earners get up to 90% of their weekly wage, capped at a state maximum, and the benefit is paid by the state, not by you. Job protection applies after 180 days of employment, which means for most of your team, FAMLI leave comes with reinstatement rights, and terminating someone shortly after a FAMLI claim is how retaliation cases get filed.

Where employers get it wrong

Four patterns account for most of the trouble. Missed remittances: quarterly filings slip and penalties accrue, this is a payroll-calendar item, not an annual one.

Uncoordinated policies: your PTO and short-term disability policies were written before FAMLI existed, and if they do not say how company leave runs alongside a state claim, whether concurrently or stacked, employees will reasonably read them in whichever order pays most.

FMLA confusion: at 50 or more employees federal FMLA also applies, and the two run concurrently only when you designate them properly. And quiet discouragement: managers who signal that taking leave is a problem create interference claims, the statute prohibits discouraging use, not just denying it.

Private plans

Employers can apply to substitute an approved private plan that offers equal or better benefits, which occasionally pencils out for larger employers with existing disability carriers.

But the plan must be approved by the state, carries its own filing obligations, and for most small businesses the administrative overhead outweighs the premium difference. Current rates, wage caps, and the private plan process are published at famli.colorado.gov.

What this means for your business

The premium is the cheap part, a known line item you can budget to the dollar. The real work is the handbook and policy layer: leave coordination language, manager training on what not to say when someone announces a leave, and a documented process for the 180-day job-protection analysis.

That is a few hours of policy work, typically $500 to $1,500 as part of a broader policy review, against retaliation and interference claims that start in five figures. If your handbook predates 2024, FAMLI coordination is almost certainly missing from it, and that is a payroll and benefits conversation worth having before the next claim, not after.