Last Thursday, ESD announced that premium rates will increase to 0.8% for 2023. This rate was confirmed several hours after IWR had reported on the status of the independent actuarial studies and reviews of Washington’s Paid Family and Medical Leave program (PFML).
Starting January 1, 2023:
- The total premium rate will be 8%.
- Employers will pay 24% of the total premium, and employees will pay 72.76%.
- Employers will continue to report each employee’s total gross wages, not including tips, and collect premiums up to the Social Security cap ($160,200 in 2023). Once an employee meets the Social Security cap, employers must stop collecting premiums but continue to report their wages.
- 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 continue to collect the employee premium or pay the employees’ premiums on their behalf
Premium rates were 0.4% in 2021 and increased to 0.6% in 2022. With this premium hike, the rate will have doubled in just two years.
The 2022 Legislature formed a legislative task force to review the independent actuarial studies and to develop recommendations for reforming the PFML program to avoid the fiscal challenges that emerged over the past two years. The task force’s recommendations will be considered in the 2023 legislative session.