More than 175,000 Washington workers have received Paid Family and Medical Leave benefits in 2024 thus far, totaling $1.35 billion — a record compared to the first nine months of previous years.
With the rise in demand, the Paid Leave premium rate will increase. Starting Jan. 1, 2025:
- The premium rate will be 0.92%. The rate for 2024 is 0.74%.
- Employers will pay 28.48% of the total premium and employees will pay 71.52% — a ratio similar to 2024.
Washington’s Paid Leave program is funded by premiums collected from employees and employers in Washington state. By law, the Employment Security Department recalculates the premium rate annually in October. The rate is based on program usage and premiums collected the previous year.
Historically, Paid Leave claims have outpaced premiums, which resulted in an account deficit in 2023. The state Legislature responded by investing $200 million into the Paid Leave account. This investment supported solvency and led to a lower premium rate for 2024.
The decreased 2024 rate caused revenue from premiums to be lower than expenditures, which include continued growth in benefit payments. The program expected that this difference between revenue from premiums and expenditures would lead to a higher rate for 2025.
Several factors account for the program’s increase in benefit payments. These include:
- Organic program growth.
- Sunsetting the collective bargaining agreement provision.
- More employees becoming eligible for benefits with rising employment after the pandemic.
Small businesses 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. Employment Security classifies employers with fewer than 50 employees as small businesses.
Learn more at paidleave.wa.gov.
