Elizabeth Hovde of the Washington Policy Center believes lawmakers should stop digging a PFML hole, admit the program harms more workers than it helps, and let workers in our state keep more of their incomes
Washington Policy Center
Some employers are wisely preparing their employees for an increased payroll deduction. The culprit for workers’ decreased wages in this instance is the state’s struggling Paid Family and Medical Leave (PFML) program.
The amount workers pay for the social program — that many will never need or use — went up this month, doubling the payroll tax rate initially allocated when PFML legislation passed in 2017. A tax rate on workers and employers of 0.4 percent is now 0.8 percent. Why? More people used the program than expected, supply has not kept up with demand and the fund is in trouble. If you build it, they will come — and workers did.
Senate Bill 5286, which would modify details of the tax’s funding formula to help it pay its way better in the future, is rightly moving in the Legislature. The new formula is expected to help keep the program out of the red — that is along with the unfortunate doubling of the payroll tax and a recent $350-million legislative bailout from the general fund. (SB 5286 is bipartisan and helpful, but it’s not at all celebratory. It simply rearranges deck chairs on this Titanic.)
If you want to see how much you and your employer will pay for this program that helps people in need and people not in need — while encouraging workers not to save for life’s decisions and emergencies and instead rely on the government — use this payment calculator, available on the PFML website. Employers will continue to report each employee’s total gross wages, not including tips, and collect the tax up to a Social Security cap of $160,200 in 2023.
There is nothing you need to do, human resource specialists inform their employees — other than cry, I say.
In a time where inflation is cruelly biting at family budgets, many workers could have used the hundreds of dollars every year that will be going to people who sometimes have higher incomes than they do. And a tax for long-term care will take away even more of a worker’s earnings in July. Get ready.
We do and should have safety nets for people in need, even when their own decisions and lack of preparation put them there. PFML, however, expands a safety net far too wide and hurts people’s ability to be self-sufficient.
Lawmakers should stop digging a PFML hole, admit the program harms more workers than it helps, and let workers in our state keep more of their incomes.
Elizabeth Hovde is a policy analyst and the director of the Centers for Health Care and Worker Rights at the Washington Policy Center. She is a Clark County resident.
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