Is SDI tax different from EDD UI tax deduction? Confused about my paystub withholdings

SDI stands for State Disability Insurance, which is different from Unemployment Insurance (UI). In California, employees don't directly pay into UI - employers do. Your employer pays UI taxes to the state on your behalf, which is why you don't see it as a deduction on your paystub. SDI covers both disability and paid family leave benefits. As long as you're an employee (not an independent contractor) and your employer is reporting your wages properly to the state, you should be covered for unemployment if you qualify when needed.

the SDI is 1.1% of ur wages. my uncle said it goes up every year lol. but ya employers pay the UI part 100%, we dont pay that. good thing cuz california taxes r already killing us!! 🥵

To expand on what others have said, UI (Unemployment Insurance) contributions are made solely by your employer in California. They pay a percentage based on their experience rating (how many former employees claim unemployment). The SDI (State Disability Insurance) that you see on your paystub is 1.1% of your wages in 2025, with a wage limit of $153,164 for the year. The important thing to know is that all your wages reported by your employer are building your UI eligibility, even though you don't directly contribute to UI. When determining your benefit amount, EDD looks at your highest quarter of earnings during your base period (typically the first four of the last five completed calendar quarters before you file a claim).

I was CONVINCED for years that i was paying into UI directly!! I got into a HUGE argument with my brother-in-law at Thanksgiving about this exact thing! He kept saying employers pay UI and I kept saying NO WAY I see it on my paystub...turns out I was looking at SDI the whole time and he was right. 🤦‍♀️ Still don't understand why they don't make this clearer to employees. All these abbreviations are so confusing!!

Had a similar confusion when I got my first job in CA. Just to add to what others said, your employer pays several employment taxes you don't see: - UI (Unemployment Insurance) - ETT (Employment Training Tax) - SUI (State Unemployment Insurance) You only pay SDI (State Disability Insurance), which covers disability and paid family leave. As long as you're W-2 and not 1099, you're good for unemployment eligibility. Your employer handles all that.

Just be careful that your employer is actually paying their UI taxes! I had a terrible situation last year where my company wasn't paying their employment taxes properly, and when I tried to file for unemployment, I ran into huge problems. EDD couldn't verify my wages because my employer hadn't been reporting them correctly! If you're really concerned, you can create an account on UI Online and check your wage history. If you're having any issues reaching EDD by phone (which is likely - their phone system is awful), I used Claimyr.com to get through to an agent quickly. They have a video that shows how it works: https://youtu.be/JmuwXR7HA10?si=TSwYbu_GOwYzt9km. Saved me hours of redial frustration. The agent was able to confirm which quarters had reported wages and which didn't.

To set up a UI Online account, you just need your basic personal info (SSN, address, etc.) and to create a login. You don't need to actually file a claim to create an account. Once you're in, you can see your wage history that employers have reported, which gives you peace of mind that everything's being reported correctly. It's good to check periodically, especially if you change jobs.

My company messed up my wage reporting once and it was a NIGHTMARE trying to fix it when I needed benefits. Better to check now than when you're desperate for money!

To answer your follow-up question - yes, all quarters that you've worked as a W-2 employee should count toward UI eligibility, provided your employer is properly reporting your wages to EDD. The UI system looks at your base period (usually the first four of the last five completed calendar quarters) to determine eligibility and benefit amount. You need to have earned at least $1,300 in your highest quarter during the base period to qualify for a minimum UI claim in California.

Great thread! Just wanted to add that if you're ever unsure about your wage reporting, you can also check your annual W-2 form at the end of the year. Box 14 on your W-2 should show your SDI wages, which confirms your employer is properly reporting to the state. Also, keep in mind that if you switch jobs frequently, make sure each employer is reporting correctly - I've seen cases where people had gaps in their wage history because a previous employer didn't file their quarterly reports on time. It's worth checking your UI Online account after starting any new job to make sure everything shows up properly within a few months.

This is such a helpful thread! I just started my first job in California last month and was totally confused by all the deductions on my paystub. I kept wondering why I didn't see "unemployment" anywhere but now I understand that SDI and UI are completely different things. It's reassuring to know that my employer is handling the UI payments behind the scenes. I'm definitely going to set up that UI Online account to check my wage history - better safe than sorry! Thanks everyone for explaining this so clearly.

This is exactly the kind of confusion I had when I first moved to California! The abbreviations on paystubs are so confusing. One thing that helped me understand it better was thinking of it this way: SDI is like insurance YOU pay for (disability/family leave), while UI is like insurance your EMPLOYER pays for (unemployment). Both protect you, but they're funded differently. Also, if you want to double-check that your employer is legit and paying their taxes properly, you can look up their business on the California Secretary of State website to make sure they're in good standing. I learned this the hard way after working for a sketchy company that wasn't paying their employment taxes! Your wages won't count toward UI eligibility if your employer isn't properly registered and paying their obligations.