Premiums

These employees are subject to premium assessment as their work is localized to Washington. They would be eligible for benefits if they have a qualifying event and have worked at least 820 hours in Washington during their qualifying period.

In some circumstances, employers can apply for a conditional waiver for employees who work in Washington temporarily.

It depends. Paid Leave uses the same localization standards as the federal unemployment insurance program.

If an employee lives out of state but they work entirely in Washington, their work is localized to Washington. They are subject to premium assessment, and if they experience a qualifying event and worked at least 820 hours in the qualifying period, they may be eligible for benefits.

If an employee lives in Washington but their work is performed entirely out of state, the work is localized out of state. You would not withhold premiums from these employees or include them on your quarterly report, and they will not be eligible for benefits.

If an employee’s work cannot be localized to a single state because they perform their work in multiple states throughout the quarter, you may use the location of the employee’s base of operations as the tiebreaker.

For more information on localization, see Unemployment Insurance Program Letter 20-04.

2024 Premiums

Paid Family and Medical Leave is funded through premiums paid by both employees and employers.

• The premium rate is 0.74 percent of each employee’s gross wages, not including tips, up to the 2024 Social Security cap ($168,600).
• Of this, employers with 50+ employees will pay up to 28.57% and employees will pay 71.43%.

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 the fall and published prior to January 1.

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.

Note: If your business size changes (from small to large, or large to small), we will send a letter in October to the mailing address listed in your Paid Leave account.

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.

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

NEW! Learn more about 2024 premiums

Detailed information on calculating premiums is available at paidleave.wa.gov/employer-roles-responsibilities.  Estimate your premiums here.

In Paid Family and Medical Leave, wages are generally referred to as gross wages without tips. Wages are defined in statute (RCW 50A.05.010) 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

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.