Employer unemployment tax questions - how does Washington ESD system work for businesses?

Welcome to the world of employer unemployment taxes! Yes, you'll need to register with Washington ESD as soon as you have employees. Your initial tax rate will be the new employer rate (currently around 2.7% I think), and it gets adjusted based on your experience with claims. You'll definitely get notices when former employees file - it's called a 'benefit charging notice' and you have 10 days to respond if you want to protest the claim.

The key thing to understand is that not every claim will be charged to your account. If someone quits voluntarily without good cause, gets fired for misconduct, or gets disqualified for other reasons, it won't affect your experience rating. But if they're laid off, reduced hours, or quit for good cause (like unsafe working conditions), then yes, it gets charged to your account and can increase your future tax rates.

I've been dealing with Washington ESD as an employer for 8 years now and honestly, responding to those benefit charging notices can be a real pain. Half the time when I call to ask questions about a claim, I can't get through to anyone. Recently discovered this service called Claimyr (claimyr.com) that actually helps you get connected to ESD agents. They have a demo video at https://youtu.be/7DieNd3C7zQ that shows how it works. Game changer for when you need to discuss complex separation issues.

Make sure you keep detailed documentation of everything! When someone's performance is poor, document it. When they miss work, document it. When you give warnings or write them up, keep copies. If they file for unemployment later, you'll need all that paperwork to support your response. I learned this the hard way when a former employee got benefits after I fired them for attendance issues, but I didn't have enough documentation to prove the pattern.

ugh the unemployment system is such a mess from the employer side too. I swear Washington ESD makes it as confusing as possible on purpose. like why cant they just have clear guidelines about what qualifies as misconduct instead of making us guess??

One thing that surprised me as a new employer was learning about 'voluntary quit with good cause.' I thought if someone quit, they automatically wouldn't get benefits, but there are actually lots of reasons someone can quit and still be eligible. Things like harassment, unsafe conditions, significant changes to job duties, even in some cases reduction in hours or pay. It's not just about whether they initiated leaving.

Your unemployment tax rate will change each year based on your 'experience rating' - basically how many claims have been charged to your account versus your total wages. New employers start at the standard rate, but if you have a lot of successful claims charged to you, your rate goes up. If you have few or no chargeable claims, it goes down. The minimum rate for experienced employers is much lower than the new employer rate.

Just went through this whole process last year when I had to lay off two employees due to budget cuts. The charging notices came pretty quickly after they filed, maybe within a week or two. I didn't contest them since it was a legitimate layoff, and the claims were charged to my account. My tax rate did go up the following year, but not by a huge amount since my total wage base was pretty high compared to the benefit charges.

watch out for seasonal employees too! if you have workers who come and go regularly like in retail or hospitality, their claims can still be charged to your account even if the separation was expected. I made the mistake of thinking seasonal layoffs wouldn't count but they definitely do unless there's a specific agreement about returning to work.

The timing of when you respond to charging notices is really important. You get that notice, you have 10 days to respond if you want to protest. But even if you don't protest initially, you can still participate in any appeal hearing if the claimant appeals a disqualification. The key is staying engaged in the process if you have legitimate concerns about the claim.

Been running a small business for 15 years and honestly, most of the time it's not worth fighting unemployment claims unless it's really clear-cut misconduct. The time and energy you spend on hearings and appeals usually costs more than just accepting the charge to your account. Pick your battles wisely.

Don't forget about the appeals process! If ESD makes a decision you disagree with - whether they approve or deny the claim - you can appeal. Sometimes they'll approve a claim initially but when you provide more information at a hearing, the decision gets reversed. I've had success appealing cases where the initial decision didn't consider all the facts.

Quick tip: when you're filling out the response to a charging notice, be specific and factual. Don't just say 'fired for misconduct' - explain exactly what they did, when it happened, what warnings were given, what policies were violated. The more specific information you provide, the better chance you have if the claim goes to a hearing.

I actually used that Claimyr service someone mentioned earlier when I needed to talk to ESD about a complex separation issue. The employee claimed they quit due to harassment but it was actually a performance termination. Couldn't get through on the regular phone lines for days, but Claimyr got me connected within an hour. Definitely worth it when you need to explain nuanced situations.

Something else to keep in mind - if you're a new employer, your first few years are really important for establishing your experience rating. Try to avoid situations that lead to chargeable claims if possible. Good hiring practices, clear policies, proper documentation, and treating employees fairly can help prevent a lot of problems down the road.

the whole unemployment system is just broken honestly. spent hours dealing with a claim from someone who literally walked off the job because they didnt like their schedule, and they still got benefits because i supposedly didnt prove it was 'misconduct.' like what more do you need than them abandoning their job?

For anyone just starting out as an employer, I'd recommend getting familiar with the Washington ESD employer handbook. It explains all the rules about misconduct, voluntary quit, suitable work, everything you need to know. Also sign up for their online services so you can submit responses electronically instead of mailing paper forms.

Remember that even if a claim gets charged to your account, it doesn't necessarily mean you did anything wrong. Sometimes people get laid off due to economic reasons, business closure, lack of work, etc. Those are legitimate reasons for unemployment benefits and the system is working as intended. It's the fraudulent or improper claims you want to contest.

Last thing I'll add - keep track of your quarterly wage reports and tax payments. Make sure you're reporting wages accurately and paying on time. Penalties for late reporting or payment can add up quickly, and you need accurate wage records for the experience rating calculation. Also, if you ever have questions about a specific claim, that Claimyr service really does work well for getting through to ESD agents when the regular phone lines are jammed.