Are small businesses exempt?

Businesses of all sizes are part of this program.

Small businesses with fewer than 50 employees are exempt from paying the employer portion of the premium.

  • Small businesses must still withhold their employee's portion, or cover it on their behalf.
  • Businesses of all size must fulfill all reporting requirements.
  • Employees at small businesses do not pay more than 63.333% of the total 0.4% and they are still fully covered by the program. 

Here is how the calculation works:

Employee gross wage x .004 = Total premium

Total premium x .6333 = Maximum premium amount assessed of small businesses. This amount can be withheld from the employee's paycheck, or covered by the employer on their behalf.

You can estimate your premiums using our premium calculator. Please note: Premiums should be withheld from each paycheck. Employers cannot collect missed premiums in later pay periods.

How is business size calculated?

ESD will calculate your business’s size on an annual basis Sept. 30 of each year. It is based on your average employee headcount over the previous four quarters as reflected in the reports you submit to ESD. It is not calculated by FTE positions.

Business size calculation for 2019 only:

  • ESD will determine the size of your business based on your first quarter report (Jan – March), and this is the number ESD will use for 2019.
  • On Sept. 30, 2019, ESD will average the number of employees reported over the previous quarters to determine business size for calendar year 2020.
  • You won’t receive ESD’s calculation of your business’s size until we receive your first quarterly report in April 2019. However, tracking the headcount of your employees for the first quarter of 2019 will give you the best indication of whether you will need to pay the employer portion of the premium in April.

Even if you are exempt from FMLA or Unemployment Insurance (UI) requirements, you are more than likely required to participate in this program. The only significant exemptions for Paid Family and Medical Leave are federal employers and employees, federally recognized tribes and sole-proprietors.