Connecticut Payroll Compliance Guide 2026: PFML, Taxes & Labor Laws

Connecticut operates one of the more active employer-side payroll compliance environments in New England. The state's PFML program launched in January 2022 and added a new payroll withholding obligation that every employer with at least one Connecticut employee must manage. Add in a graduated income tax, a SUI wage base of $25,000, a minimum wage now above $16, and a mandatory pay stub requirement — and there's real complexity here for small businesses new to the state.

The good news: most of it integrates cleanly into payroll software. The risk is in the setup. Get the PFML withholding configured wrong, miss a quarterly remittance, or fail to register with the Paid Leave Authority, and you're looking at penalties and interest. This guide walks through every obligation in sequence.

Connecticut Payroll at a Glance

CT Paid Family and Medical Leave (PFML)

Connecticut's PFML program requires employers with one or more employees to register with the CT Paid Leave Authority and withhold 0.5% from employee wages. Employees pay the full 0.5% — there is no employer share (unlike Colorado's FAMLI, which splits the cost for larger employers).

PFML Contribution Details

• Rate: 0.5% of the employee's wages
• Wage base: First $168,600 of wages per employee per year (matches the 2026 Social Security wage base)
• Maximum annual employee contribution: $168,600 × 0.5% = $843.00 per year
• Employer share: None (100% employee-paid)
• Who must register: All employers with 1 or more CT employees

Contributions are remitted quarterly to the CT Paid Leave Authority through their online portal at ctpaidleave.org. The remittance schedule aligns with standard quarterly payroll deadlines.

What CT PFML Provides

Eligible employees can take up to 12 weeks of paid leave per year (plus up to 2 additional weeks for pregnancy-related conditions) for:

• Their own serious health condition
• Caring for a family member with a serious health condition
• Bonding with a new child (birth, adoption, or foster placement)
• Military qualifying exigency
• Safe leave (domestic violence, sexual assault, stalking)

Benefits replace 60% of the employee's average weekly wage, up to 60% of the Connecticut average weekly wage (CAWW), which adjusts annually.

State Income Tax Withholding

Connecticut has a graduated income tax with rates from 3% to 6.99%. The brackets are structured as follows (single filers in 2026):

Married filers have different bracket thresholds. Employees complete Form CT-W4 to declare their withholding status and any additional withholding. Remit withholding to the Connecticut Department of Revenue Services (DRS) through myconneCT, the state's online filing portal. Filing frequency is assigned by DRS based on your withholding volume.

State Unemployment Insurance (SUI)

Connecticut SUI is administered by the Connecticut Department of Labor (CTDOL). The $25,000 wage base is above average nationally, making Connecticut's SUI cost significant even for employers with modest payrolls.

SUI Rates for 2026

• New employer rate: 3.0%
• Experienced employer range: 1.9% to 6.8%
• Taxable wage base: $25,000 per employee per year
• Maximum annual cost per employee (new employer at 3.0%): $750
• Maximum possible cost per employee (at 6.8%): $1,700

SUI returns are filed quarterly through the Connecticut Department of Labor's online system. Deadlines: April 30, July 31, October 31, January 31.

Minimum Wage

Connecticut's minimum wage reached $16.35 per hour in 2026. Connecticut ties its minimum wage adjustments to the Employment Cost Index (ECI), a broader measure of labor costs than the Consumer Price Index. This indexing mechanism can produce larger-than-expected annual increases in years when labor market costs accelerate.

Connecticut allows a tip credit for service workers. The minimum cash wage for tipped employees is $6.38/hr for hotel and restaurant workers, as long as tips bring total compensation to the $16.35 minimum. Bartenders have a different minimum cash wage under Connecticut law — verify the current rates with the Connecticut Department of Labor's wage and workplace standards division each year.

Overtime

Connecticut follows federal FLSA overtime rules: non-exempt employees earn 1.5x their regular rate for hours over 40 in a workweek. Connecticut has no daily overtime requirement beyond FLSA.

Pay Stub Requirements

Connecticut law requires employers to provide employees with an itemized wage statement (pay stub) each pay period. The stub must show:

• Gross wages earned during the pay period
• All deductions from wages, itemized by type (taxes, insurance, garnishments, etc.)
• Net wages paid
• Hours worked (for hourly employees)

Electronic pay stubs are acceptable if the employee consents to electronic delivery. Consent should be documented. Employees who want paper stubs must receive them. Storing and retrieving previous pay stubs electronically is fine as long as employees can access their records.

Final Paycheck Rules

Connecticut requires final wages to be paid on the next regular payday following separation. The rule applies to both voluntary and involuntary terminations. There's no requirement to pay on the day of discharge.

Accrued Vacation

Connecticut does not have a statute that automatically requires vacation payout at termination. Your written policy governs. If your handbook says earned vacation is paid out upon separation, that creates an enforceable obligation. If your policy is silent or explicitly states that unused vacation is forfeited, Connecticut courts will generally enforce that if the policy was clearly communicated.

Federal Payroll Taxes

Connecticut employers owe federal payroll taxes in addition to state obligations:

• Social Security: 6.2% employer + 6.2% employee on wages up to $176,100
• Medicare: 1.45% employer + 1.45% employee on all wages; 0.9% Additional Medicare Tax on employee wages over $200,000
• FUTA: 6.0% on first $7,000, effective 0.6% with state UI credit
• Federal income tax withholding: Per each employee's W-4

Registering as a New Employer in Connecticut

Three registrations are required before running Connecticut payroll:

• CTDOL registration: Register with the Connecticut Department of Labor for your SUI account at ctdol.state.ct.us.
• DRS registration: Register with the Department of Revenue Services for income tax withholding at myconneCT (portal.ct.gov/DRS).
• CT Paid Leave Authority: Register at ctpaidleave.org for PFML withholding and remittance. Required for all employers with at least one CT employee.

Frequently Asked Questions

What is the Connecticut PFML contribution rate for 2026?

The CT PFML rate is 0.5% of wages up to $168,600 per year, withheld from employees. The employer pays no share. Maximum annual employee contribution is $843.00. All employers with at least one CT employee must register and remit quarterly.

What is Connecticut's minimum wage in 2026?

Connecticut's minimum wage is $16.35 per hour, adjusted annually based on the Employment Cost Index. Tipped employees have different minimums; verify current rates with CTDOL each year.

What are Connecticut's SUI rates for new employers in 2026?

New employers pay 3.0% on the first $25,000 of each employee's annual wages. Experienced employer rates range from 1.9% to 6.8%.

What is Connecticut's state income tax rate?

Connecticut has a graduated income tax ranging from 3% to 6.99%, with seven brackets. Employees complete Form CT-W4; employers remit withholding through myconneCT.

When is a final paycheck due in Connecticut?

The final paycheck is due on the next regular payday following separation, for both voluntary and involuntary terminations.

Does Connecticut require employers to provide pay stubs?

Yes. Pay stubs are required each pay period, showing gross wages, all deductions itemized, and net pay. Electronic pay stubs are permitted with employee consent.