Washington Paid Leave Premium Rises to 1.2% on Jan. 1, 2027

Washington's Paid Family & Medical Leave premium increases to 1.2% of gross wages on Jan. 1, 2027, up from the current 1.13%. The 0.07-percentage-point increase applies to every covered employer in the state and takes effect with the first payrolls of the new year.

The split stays the same even as the rate climbs. Employers pay 29.3% of the premium and employees pay 70.7%, though employers may voluntarily cover some or all of the employee share. On a $60,000 salary, the total premium rises from $678 per year to $720 — about $42 more annually before any employer offsets.

Which employers pay the employer share?

The size threshold determines the employer obligation. Generally, employers with fewer than 50 employees do not need to pay the employer share at all. Two conditions still apply to these small employers:

• They must collect or cover the employee share of the premium regardless of headcount.
• If they accept a small-business assistance grant, they must pay the employer share for three years as a condition of receiving it.

For employers at or above 50 employees, the 29.3% employer share is mandatory on top of withholding the 70.7% employee portion.

What wages does the premium apply to?

The premium base is gross wages, excluding tips, up to the Social Security wage cap. That means compensation above the federal wage cap carries no Washington PFML premium, and tipped amounts drop out of the calculation entirely. Payroll teams should verify that their systems exclude tips and cap the assessment correctly before the first 2027 pay period.

What should HR and payroll do before Jan. 1?

The state expects two actions before the effective date. Employers should notify employees of the rate change, and payroll systems need updating to reflect the 1.2% total premium and the 29.3/70.7 split. Employers who choose to subsidize part or all of the employee share should build that offset into the configuration at the same time.

One compliance trap deserves attention: missed employee premiums cannot be withheld retroactively. If payroll under-withholds during 2027, the employer cannot claw the shortfall back from later paychecks. That makes accurate configuration at the start of the year more than an administrative detail — it shifts the cost of any withholding error onto the employer.

When are reports and payments due?

First-quarter 2027 reports and premium payments are due April 30, 2027. Employers filing for the first quarter under the new rate should calendar that deadline now, since late filings typically carry penalties and interest under the state program.

The rate increase follows the program's statutory design, which adjusts the premium as claims experience and fund solvency require. Employers should watch for further updates from Washington's Employment Security Department as the Jan. 1, 2027 effective date approaches.