December 2022 | Issue 29
WA Cares: Implementation timeline and new employee exemptions
Premium collection begins in July (Q3)
Worker contributions to the WA Cares Fund, the state’s new long-term care insurance program, start next year. Beginning July 1, 2023, you must collect WA Cares premiums from your employees' wages and report their wages and hours at the end of each quarter—the same way you do now for Paid Leave. Reporting will begin October 2023 and will follow the same payment process as Paid Leave.
As an employer, you won’t pay any share of WA Cares premiums for your employees.
Previously approved exemptions are still valid
Workers who had private long-term care insurance on or before November 1, 2021, are able to apply to ESD for an exemption from the WA Cares Fund until December 31, 2022. Under current law, these exemptions are permanent and employees who have received an approved exemption will not be able to re-enroll in the program.
If your employees previously applied for a private insurance exemption and received an approval letter from ESD, their exemption is still valid. They do not need to re-apply and you should keep their exemption letters on file. Employees who can’t find their exemption letter can download a copy from the Secure Access Washington account they used to apply for the exemption.
New exemption categories
Beginning January 1, 2023, Washington workers will be able to apply for an exemption from WA Cares if any of the following apply to them:
- They live outside of Washington.
- They are the spouse or registered domestic partner of an active-duty service member of the United States armed forces.
- They have non-immigrant work visas.
- They are veterans with a 70% service-connected disability rating or higher.
Workers will only qualify for these exemptions as long as these circumstances apply. If workers no longer qualify for their exemption, they will be required to notify ESD and their employer within 90 days. Exception: Veterans with a 70% service-connected disability rating or higher will receive a permanent exemption.
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 you and give you a copy of their approval letter from ESD.
Once notified, you must:
- Not deduct WA Cares premiums from employees who’ve provided an ESD exemption approval letter. Note: this letter will list the date on which the employee’s exemption takes effect.
- Keep a copy of your employees’ approval letters on file.
It is the employee’s responsibility to notify you of any changes to their exemption status and failure to do so can result in required back-payment of premiums and additional penalties.
Learn more about WA Cares exemptions
Employer resources
WA Cares resources for businesses are available online in the employer toolkit. Additional toolkit materials are in progress and will be published in January.
To stay up to date on new developments and materials, you can sign up for the WA Cares mailing list.
Paid Leave: Premiums to increase in 2023
Resources for employers
Paid Family & Medical Leave benefits are an increasingly vital source of support for Washington workers. To keep pace with more people using the program, and as required by law, the premium rate will increase in 2023.
Starting Jan. 1, 2023:
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The total premium rate will be 0.8%.
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Employers will pay 27.24% of the total premium and employees will pay
72.76%.
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Employers will continue to report each employee's total gross wages, not including tips, and collect premiums up to the Social Security cap. Once an employee meets the Social Security cap, employers must stop collecting premiums but continue to report their wages.
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Businesses classified by the Employment Security Department as having fewer than 50 employees are not required to pay the employer portion of the premium. However, they must still collect the employee premium or pay the employees’ premiums on their behalf.
Next steps for employers
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Notify your employees that you will start collecting the new rate on Jan. 1, 2023.
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On Jan. 1, 2023, start collecting the new premium rate from your employees each pay period. Remember, you cannot retroactively withhold premiums from employees.
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First-quarter premiums and reports are due by the end of April 2023.
Why the premium rate is changing
Premiums, collected from employees and employers through quarterly reporting, fund the Paid Leave program. By law, we recalculate the Paid Leave premium rate annually in October. The premium rate is adjusted based on contributions from premiums and benefits paid during the previous year.
Important details:
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You can choose to withhold the entire 72.76% from your employee’s paycheck, or you can cover all or some of the premium on your employee’s behalf.
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If you are using a voluntary plan for family or medical leave, your calculations may be different. Visit paidleave.wa.gov/voluntary-plans for more.
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Premium withholdings are capped at the Social Security cap, which is updated annually. It will be $160,200 in 2023.
Unemployment Insurance (UI): Two changes coming to your fourth quarter tax report!
For your fourth quarter report, you must:
- Upgrade to the latest version of Employer Account Management Services (EAMS).
- Report Standard Occupational Classification (SOC) codes.
Join us for two instructional webinars:
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SOC code webinar — Monday, Jan. 23, 11 a.m. to noon – Register
Check out our previously recorded SOC code webinar or download our webinar presentation to review commonly asked questions and answers.
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EAMS upgrade webinar — Friday, Jan. 20, 11 a.m. to noon — Register
Watch our recent EAMS webinar or check out the slide deck.
Upgrading to the latest version of EAMS
If you haven’t done so already, you will need to upgrade to the latest version of the Employer Account Management Services (EAMS) system before you file your fourth quarter tax report.
It’s easy:
- Log into SecureAccess Washington (SAW) and sign into EAMS.
- Select the upgrade link and follow the instructions.
Once you’ve upgraded in EAMS, here are a few things to know about filing your tax report:
- If you file a combined unemployment tax report for multiple employers in one file, you need to use our new bulk filing format specifications.
- If you file an unemployment tax report for yourself or one employer at a time, our format has changed. Learn more on our website.
- When you log into SAW in the future, choose the new version of EAMS to file your taxes. You won’t be able to use the old version of EAMS to file after you upgrade.
Register for our Jan. 20 webinar or watch a recorded one.
Reporting Standard Occupational Classification codes
SOC is a federal coding system that helps government agencies and private businesses compare occupational data. All employers are now required to report SOC codes when they submit their quarterly tax reports starting with their fourth quarter 2022 report.
But don’t worry! We’re here to help.
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