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Documents and Forms

Premiums

How is Paid Family and Medical Leave funded?

Paid Family and Medical Leave is funded through premiums paid by both employees and employers. The 2021 premium is 0.4% of employees’ gross wages. The premium is divided between the employee (63.33%) and the employer (36.67%).

Small businesses with fewer than 50 employees are not required to pay the employer portion of the premium, but they still collect and submit the employees’ share of the premium, and their employees are fully eligible for the benefit.

Under the law, the premium rate is calculated annually in fall and published prior to January 1.

How is business size calculated?

Your business’s size is calculated on September 30 of each year. It is based on your average employee headcount over the previous four quarters as reflected in the reports you submit quarterly. It is not calculated by full-time equivalent (FTE) positions.

If you have not been in business in Washington long enough to report four calendar quarters by September 30, we calculate your business size by averaging the number of employees reported over the quarters for which reporting exists.

How should Paid Family and Medical Leave appear on a paystub or W2?

The Paid Family and Medical Leave statute doesn’t address this question and it should be addressed to a tax or payroll expert.

How do I calculate my premiums?

Detailed information on calculating premiums is available at paidleave.wa.gov/premiums.calculator to estimate your premiums is here.

What are gross wages?

In Paid Family and Medical Leave, wages are generally referred to as gross wages without tips. Wages are defined in statute (RCW 50A.04.010) as the remuneration paid by an employer to an employee (up to the Social Security cap for premium assessment).

For premium assessment and quarterly reporting, gross wages include:

  • Salary or hourly wages
  • Cash value of goods or services given in the place of money
  • Commissions or piecework
  • Bonuses
  • Cash value of gifts or prizes
  • Cash value of meals and lodging when given as compensation
  • Holiday pay
  • Paid time off (vacation, sick leave, associated cash outs)
  • Separation pay such as severance pay, termination pay, or wages in lieu of notice
  • Value of stocks at the time of transfer to the employee (if part of a compensation package)
  • Compensation for use of specialty equipment, performance of special duties or working particular shifts
  • Stipends and per diems (unless provided to cover a past or future cost incurred by the worker as a result of the worker’s expected job functions)

Wages may not include:

  • Tips
  • Supplemental benefit payments
  • Payments provided to cover a past or future cost incurred by the worker as a result of the worker’s expected job functions
  • Payment into retirement or disability plans

What employee hours do I need to report?

Employers must report the number of hours each employee works each quarter including paid time off hours, rounded up to the nearest whole number. Read more about the definition of employee hours.