At the beginning of this year, Washington state implemented the first stage of the Paid Family & Medical Leave (PFML) program. As of January 1st, 2019, employers are required to withhold PFML premiums from employee’s paychecks and remit these premiums to the Employment Security Department on a quarterly basis. The premiums are .4% of wages; note that businesses with fewer than 50 employees are not required to submit the employer portion of the premiums (unless they desire to qualify for small business assistance grants).
In the event an employee needs to take time off and uses their PFML, employers who voluntarily pay the employer premium will be eligible to apply for grants that can help cover the costs incurred when an employee take leave. You can read more about the small business assistance grants here.
However – at this time, the PFML reporting site is not set up to calculate and receive the optional employer-paid premiums from small businesses. Further, when the site is working, the state will be receiving employer premiums from that point forward and NOT from previous quarters already reported.
If you were expecting to remit the optional employer-paid premiums for your 1st and 2nd quarter wages, it would be a good idea to check with your payroll processor or accountant to verify what was remitted for those reports. Also, you can call the Paid Family & Medical Leave customer care line at 833-717-2273 for more information.
Today’s blog comes from our Lead Accountant, Adrienne Kaylor.
If you are an employer in Washington state, it’s important to make sure you are reporting wages for unemployment taxes correctly to the Employment Security Department. Reporting requirements are as follows:
Salaried or Commissioned Employees – Report actual hours worked. If hours are not tracked, report 40 hours per week for full-time employees.
Overtime – Report actual hours worked.
Vacation pay – Report the number of hours for leave with pay.
Payment in kind – Report actual hours worked.
Pay in lieu of notice – Report the hours that would have been worked.
Severance pay, bonuses, tips and gratuities – Report zero (0) hours.
You’ll notice that sick time hours are not listed as reportable. According to WAC code 192-310-040, any hours paid for sick time do not need to be reported, as long as they are paid under a qualified plan. A qualified plan is a plan that covers everyone and all employees have access to – in an employee handbook or posted visibly for everyone to see.
As of January 1, 2018, all WA employers are required to offer paid sick leave to their employees and to notify them in writing that the sick time is available to them. If you are abiding by these state requirements, you are paying sick leave under a qualified plan and do not need to report sick wages for unemployment taxes. For more information, or to be sure your plan meets the requirements, contact ESD’s employer registration line at 855-829-8243.