Setting up Paid Family and Medical Leave Contributions for Employees in Washington

If you have employees in the State of Washington, you are subject to the state’s Paid Family and Medical Leave (PFML) compliance requirements. Employers of all sizes must either withhold premiums from their employees’ paychecks or opt to cover their employees’ premiums themselves.

For more information about Washington’s PFML program, go to https://www.esd.wa.gov/paid-family-medical-leave.

PFML contributions are mandatory and the rates are the same for all of your employees. Therefore, you set the rate at the company level, not for each employee individually. These taxes came into effect in Washington on Jan. 1, 2019. SuitePeople U.S. Payroll will not calculate these taxes for paychecks with check dates prior to Oct. 1, 2019. However, you can set these rates prior to Oct. 1. Then, they are reflected in payroll batches that you calculate prior to Oct. 1, but that include dates on or after Oct. 1.

Please note the following information about the rates:

The total premium for the 2019 tax year is 0.4 percent of the employee’s gross wages. 33.333 percent of that premium goes toward family leave and 66.667 goes toward medical leave.
Employers who choose to withhold premiums may withhold no more than 63.333 percent of the total premium, and must pay the remaining 36.667 percent.
If your company averages fewer than 50 employees, you do not need to pay the employer portion of the premium. However, you must withhold the employee portion or cover it yourself.

To set the PFML rate:

Go to Setup > Payroll > Setup Tasks > Set Up Payroll.
Click the Taxes subtab.
Enter rates for the following three taxes (the values must sum to 0.4 percent or 0.004):
- WA Paid Family Leave State Plan – this contribution is employee-paid and must be 0.333 of the total contribution
- WA Paid Medical Leave State Plan (Employee) – the employee-paid contribution
- WA Paid Medical Leave State Plan (Employer) – the employer-paid contribution
The Effective Date for each tax defaults to the current date. However, these taxes will not be calculated for paycheck dates prior to Oct. 1, 2019. If you run a payroll batch prior to Oct. 1 that has check dates on or after Oct. 1, the taxes will be calculated.
Click Save.

To set the tax agency for these new taxes:

Go to Lists > Employees > Payroll Items.
For each of the WA PFML tax payroll items, click Edit.
Select a tax agency from the Agency list.
Click Save.

To update payroll information:

Go to Setup > Payroll > Payroll Management > Update Payroll Information.
Check the Agree box and then click Commit Updates.

To confirm that the PFML taxes have been added to the appropriate employees:

Go to Lists > Employees > Employees.
Choose an employee who is located in Washington and click View beside their name.
On the employee record, click the Taxes tab.
The WA Paid Family Leave State Plan and WA Paid Medical Leave State Plan (Employee) taxes appear.

When you create a payroll batch after setting these tax rates and updating payroll information, and the payroll batch check date is prior to Oct. 1, 2019, the Taxed Wage Base field will be zero because these taxes apply on Oct. 1, 2019.

To set the PFML rate:

To set the tax agency for these new taxes:

To update payroll information:

To confirm that the PFML taxes have been added to the appropriate employees:

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