Washington State Employment Securities, under RCW 50A.04, will implement the first phase of the Paid Family and Medical Leave insurance program on January 1, 2019.
The intent of this insurance program is to ensure all employees in the state who meet the eligibility requirements will, if ever necessary, have access to paid leave and time off to care for themselves or qualified family members. This insurance program is invested in through premiums paid by all Washington state employees and employers*, effective January 1, 2019.
There will be several phases of the Paid Family and Medical Leave insurance program leading up to the benefit implementation in 2020. Therefore, it is very important that employers understand their responsibilities related to collecting premiums and reporting.
January 1, 2019 – Premium collection by all WA employers begins (See Premium collection under Quick Facts)
April 1, 2019 – Reporting begins through Unemployment Insurance portal*
January 1, 2020 – Benefits become available
The first step is preparing your business and your employees for these upcoming changes, as well as making well-informed decisions regarding how your business will comply with these requirements.
This includes becoming familiar with the program, attending an educational webinar, making decisions on how your company and payroll department will comply with these new changes, and communicating with your employees about how the premiums will affect them and their paychecks.
What to do PRIOR to Jan. 1, 2019:
- Explore the Employment Securities websites on the Paid Family and Medical Leave program HERE
- If your business is under 50 employees, you may choose whether to pay the Employer contributions* (Businesses with fewer than 50 employees are not required to pay the employer portion of the premium but are required to remit employee-paid premiums to ESD and abide by all reporting requirements.)
- Make a decision whether the business will pay the Employees’ portion of the premium (The state provides the option if the Employer’s want to pay this on the employee’s behalf, or pay a portion of it, or pay for none of the employees’ total premium cost.)
- Communicate with your Washington-based employees about the changes coming on January 1, 2019. The easiest method is through this pre-made Employee paystub insert found HERE
- Prepare to report wages and hours worked – determine the best method of collecting these premiums through your payroll system
- Sign up for the Paid Family and Medical Leave program for revised program updates (bit.ly/paidleavelist)
- Download the Employer Readiness Checklist HERE
NOTE: Federal employers and employees, federally recognized tribes and sole-proprietors are exempt from the program, but tribes and sole-proprietors may opt in. If you have employees covered by a collective bargaining agreement they may have delayed participation in the program.
*Employers with less than 50 employees may Opt Out of paying the employer portion, however, ALL employees must pay their portion.
What to do AFTER Jan. 1, 2019:
- Begin collecting Paid Family and Medical Leave premiums through payroll
- Budget for the employer share of the premium
- Begin tracking hours and wages of all employees, including seasonal, temporary and part-time workers
- Premiums are 0.4% of gross wages paid.
- Employers may either withhold employees’ premiums from their paychecks or pay the entire premium for their employees. Employers who choose to withhold premiums from their employees may withhold up to 63 percent of the total premium. The employer is responsible for paying the other 37 percent.
- Businesses with fewer than 50 employees are not required to pay the employer portion of the premium but are required to remit employee-paid premiums to ESD and abide by all reporting requirements.
- Small business assistance grants are available to businesses with 50 to 150 employees and to businesses with fewer than 50 employees who choose to pay the employer share of their employee’s premium.
- Nearly all employers statewide will need to report employee wages, hours worked, and additional information to ESD every quarter.
- Employers should begin tracking hours and wages Jan. 1, 2019, to prepare for reporting in April.
- Employers who want to internally manage a paid family and medical leave plan for their employees may apply for a voluntary plan. Voluntary plans must be approved by ESD and employers will still need to meet the program’s reporting requirements.
Want more information? A new blog post will be added soon related to reporting requirement. In the meantime, you may attend a webinar by signing up HERE.
Get involved in rulemaking; It will be ongoing through 2019. Details at paidleave.wa.gov/rulemaking.