October 2021 | Issue 11

Paid Leave: Premium rate will increase in 2022

For the first time since Paid Family and Medical Leave launched, the premium rate will increase. This change goes into effect with Quarter 1 of 2022. The split of the employer and employee share of the premium rates will also change in the new year.

Starting Jan. 1, 2022, the premium rate will be 0.6%.

The new premium rate of 0.6% takes effect on Jan. 1, 2022. But for now, the current rate of 0.4% is in effect until Dec. 31, 2021.

Employers will pay approximately 27% of the total premium and employees will pay about 73%.

Continue using the 0.4% rate for the rest of 2021.

But don’t forget to withhold at the new 0.6% rate starting in January! If you don’t, you’ll be responsible for the difference during quarterly reporting.

What’s next

• Update your calculations and withhold the new 0.6% rate starting in January. If you don’t, you’ll be responsible for the difference during quarterly reporting.
• For your calculations, the employer share of premiums is 26.78% and the employee share is 73.22%.

Updated resources coming Nov. 1 to paidleave.wa.gov

We will have updated resources available at paidleave.wa.gov for you and your employees before the end of the year. Stay tuned!

Rate is increasing due to higher usage and reduced payrolls during the pandemic

Washington workers are finding value in Paid Leave.

They are using the program as intended, and it’s allowing them to take care of themselves and their loved ones when they need it most.

• There has been high usage of the program this year, and family leave use was higher than medical leave use.
• About 51% of our claims are for family leave and about 49% are for medical leave. This means we need to change the amount we collect in premiums for each type of leave.

Reduced payrolls during the pandemic

While overall usage has been high, the total premiums collected during quarterly reporting have been lower because of reduced payrolls due to Covid-19.

How we calculate premium rates

By law, we recalculate the Paid Leave premium rate annually on September 30. The premium rate is adjusted based on usage of medical leave and family leave during the previous year. Premiums, collected from employees and employers through quarterly reporting, fund the Paid Leave program.

WA Cares Fund: Premium collection and wage reporting

Beginning Jan. 1, 2022, you’ll collect WA Cares premiums from your employees the same way you do now for Paid Leave—we’re updating the Paid Leave reporting system on our end so you can report for both programs at the same time. Employers won’t pay any share of these contributions for their employees. 

No payroll? No report. You do not have to file a report for quarters where your employees had no hours worked or wages. 

Need more info on reporting? Check out this helpful info from Paid Family and Medical Leave. WA Cares reporting will be fully integrated for your convenience.

Updated reporting resources coming soon

We're updating the wage reporting resources on paidleave.wa.gov so you have everything you need to file for Q1 in 2022.

Tracking employee exemptions 

Some employees may choose to apply for an exemption from WA Cares coverage. It’s their responsibility to apply, and—if approved—to notify and give you a copy of their approval letter from Employment Security Department (ESD). Once approved, exemptions are permanent and employees can never opt back in.

Once notified, employers must:

• Not deduct WA Cares premiums from workers who’ve provided an ESD exemption approval letter. Note: this letter will list the effective date of the employee’s exemption.
• Keep a copy of their workers’ approval letters on file.

Did you miss it?

• Visit wacaresfund.wa.gov to learn about the benefit and what to expect. Your workers may look to you when they have questions about WA Cares, and we invite you to share our website as a resource. Our contact info is available if they need assistance.
• Check out our Employer page for helpful program information relating to your business. You can also find more resources in our Employer Toolkit, including a multi-language flyer that can help workers understand the benefit.
• Stop by our Learn more page to read frequently asked questions, including specific questions for employers.

Unemployment Insurance: Federal pandemic benefits expired

Federal pandemic unemployment benefits ended on the week ending Sept. 4, 2021. As a result, you might see more benefit charges starting with your third-quarter statement.

Reimbursable employers might see:

• Higher benefit charges. The federal government is no longer paying any benefit charges for former employees receiving regular unemployment benefits or SharedWork benefits. Previously, the federal government was paying 75 percent of regular benefits and 100 percent of SharedWork benefits.
• More former employees listed. When federal pandemic unemployment programs ended, some claimants transferred to regular unemployment benefits.

Taxable employers might see:

• More former employees listed. When federal pandemic unemployment programs ended, some claimants transferred to regular unemployment benefits. These additional benefit charges might affect your future tax rate.
• More benefit charges for SharedWork, if you’re enrolled in the program. Benefits paid to your SharedWork employees again affect your experience rating. The federal government stopped funding those benefits on the week ending Sept. 4.

The unpaid waiting week is back New unemployment claimants once again have an unpaid waiting week. This change won’t affect your benefit charges. Find out more about the waiting week.

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