Starting January 1, 2025, workers in Washington state will have more deducted from their paychecks to pay for a ‘paid family leave’ law.
According to the Washington Employment Security Department, the premium rate in 2025 will be 0.92%.
KVI’s John Carlson interviews Washington Policy Center director of The Center for Health Care and Center for Worker Rights, Elizabeth New, about why more money must be taken out of Washington workers’ paychecks in 2025.
To hear the interview, click the play button below.
The Paid Family Leave law allows people to take time off work for a medical reason–caring for a family member’s health, having a baby–and allows a person to receive a portion of their paycheck while taking time off their actual job.
The prime reason for the higher payroll deduction is because the Paid Family Leave is being accessed by so many Washingtonians–particularly, New says, by upper income earners.
According to the Employment Security Department, 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.
Washington workers have deductions from their paychecks for both the Paid Family Leave law as well as the Washington Cares insurance premium for Long Term Care.
