New brief: Should Washington Be in the Long-Term Care Insurance Business?
Key dates for Washington’s long-term care insurance program—and its accompanying payroll tax—are fast approaching. Beginning Jan. 1, 2022, a payroll tax of 0.58% will be levied on every employee’s wages. The tax is expected to generate revenues of more than $1 billion a year. Long-term services and supports trust (LTSST) benefits will then be available […]
September 30 , 2021 - Emily Makings
Washington’s minimum wage will increase by 5.8% in 2022
According to the Department of Labor & Industries (L&I), the state minimum wage will be $14.49 per hour in 2022. This is an increase of 5.8% over 2021’s minimum. Washington’s minimum wage has been indexed to inflation since voters approved Initiative 688 in 1998. Aside from substantial step increases to the minimum in 2017 and […]
September 21 , 2021 - Emily Makings
Average workers’ compensation rates could go up 3.1% next year—the largest increase since 2011
Today the Department of Labor & Industries (L&I) proposed increasing average workers’ compensation rates by 3.1% for 2022. According to L&I, base rates will increase for 230 of the state’s 325 risk classes (here are the proposed rates by risk class). If the rate increase is adopted later this year, it will be the first […]
September 01 , 2021 - Emily Makings
Court of Appeals: Washington’s method of determining prevailing wages is unconstitutional
The state Court of Appeals has held that the method Washington uses to determine prevailing wages for public works projects is unconstitutional. As defined in state law, the prevailing wage is “the rate of hourly wage, usual benefits, and overtime paid in the locality . . . to the majority of workers, laborers, or mechanics, […]
June 17 , 2021 - Emily Makings
How high will the long-term care payroll tax need to be to maintain solvency?
Geekwire ran an item earlier this week about the state’s impending payroll tax to fund long-term care (LTC) benefits. The program was enacted in 2019, the tax will begin to be collected Jan. 1, 2022, and benefits will be available beginning Jan. 1, 2025. We wrote about the program in a 2019 policy brief. The […]
June 15 , 2021 - Emily Makings
Growth in state average annual wage is the highest ever
In 2020, the state average annual wage was $76,741—an increase of 10.1% over 2019. According to the Employment Security Department (ESD), this is the largest annual percentage growth to the average wage ever. The higher than normal increase in reported average wages can be attributed to the fact that thousands of lower-paid workers lost their […]
April 15 , 2021 - Emily Makings
To opt out of the long-term care program, private coverage will have to be purchased by Nov. 1
In 2019, the Legislature passed a payroll tax to fund a new long-term care (LTC) benefit. Under the legislation, the tax will begin on Jan. 1, 2022 and will initially be set at a rate of 0.58%. There is no cap on the wages subject to the tax. The lifetime maximum benefit is essentially $36,500 […]
March 11 , 2021 - Emily Makings
Merging two closed state retirement funds could save the state hundreds of millions in 2021–23
The operating budget proposals from Senate and House Republicans would save around $700 million in 2021–23 by merging the assets and liabilities of the Teachers’ Retirement System (TRS) plan 1 with the Law Enforcement Officers’ and Firefighters’ System (LEOFF) plan 1. (Both plans are closed to new members.) According to the state’s most recent actuarial […]
January 14 , 2021 - WRC
New brief: Unemployment Insurance Taxes Will Be a Headwind for the State Economy
Unemployment insurance tax rates are adjusted annually and will be much higher this year due to the COVID-19 pandemic. The amount of unemployment insurance tax paid by Washington businesses is expected to increase dramatically, from $1.12 billion in 2020 to $2.11 billion in 2021 and then to $2.99 billion in 2022. This rising UI tax […]
December 28 , 2020 - Emily Makings
Washington will use federal CARES Act funds to provide “pandemic relief payments” in response to the lapse in federal unemployment insurance benefits
Earlier this month, Gov. Inslee announced that Washington would use $54.6 million of the state’s share of the federal Coronavirus Relief Fund (CRF) for unemployment insurance benefits for people in the federal Pandemic Unemployment Assistance (PUA) program, if the federal government didn’t act to extend the program before it was set to expire on Dec. […]