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How much does Washington ESD charge employers when employees file unemployment claims?

My small business just had our first employee file for unemployment and I'm trying to understand what this means for our costs. I know we pay into the unemployment insurance system but I'm not clear on how much Washington ESD will charge us specifically for this claim. Our payroll company mentioned something about experience rating but didn't explain it well. Does anyone know how the employer side of unemployment costs actually work? We've been operating for 3 years and this is our first claim so I'm not sure what to expect.

The cost isn't a direct charge per claim - it's more complicated than that. Washington ESD uses an experience rating system where your unemployment tax rate gets adjusted based on claims history. Your rate can range from 0.19% to 5.4% of wages depending on your experience. Since this is your first claim in 3 years, it shouldn't impact you too heavily.

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So there's no immediate bill we'll get? That's a relief. How long before we see the rate change?

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Rate changes typically happen annually, so you wouldn't see the impact until your next rate determination. Keep good records of the circumstances around the separation in case you need to protest the claim.

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Your experience rating is calculated by looking at benefits charged to your account over the last few years versus your total payroll. One claim won't kill you but it does establish a baseline. The key thing is whether the claim gets approved - if the employee quit without good cause or was fired for misconduct, you can contest it.

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The employee was laid off due to lack of work, so I don't think we can contest it. Sounds like we just have to accept the rate increase.

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Yeah, lack of work is pretty much automatic approval. At least you're being honest about it - some employers try to contest everything and just waste everyone's time.

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I've been dealing with Washington ESD employer stuff for years and the whole system is confusing. If you need to talk to someone about your specific situation, I found this service called Claimyr that helps you actually get through to Washington ESD agents. Check out claimyr.com - they have a demo video at https://youtu.be/7DieNd3C7zQ that shows how it works. Made my life so much easier when I had questions about our account.

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Thanks for the tip! I might need that if this gets more complicated.

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Never heard of that service but anything that helps with Washington ESD phone calls sounds useful. Their hold times are brutal.

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wait so employers have to pay for unemployment claims? i thought that was all government funded

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No, unemployment insurance is funded by employer taxes. That's why it's called 'insurance' - employers pay premiums based on their risk level, just like any other insurance.

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wow i had no idea. so when i filed for UI last year my old company had to pay for it?

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Not directly, but it impacts their tax rate going forward. The more claims they have, the higher their rate gets.

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The experience rating calculation is actually pretty fair once you understand it. New employers start at a standard rate around 2.7% I think, then it adjusts based on actual claims. If you have low turnover and few claims, your rate goes down. High turnover businesses pay more.

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That makes sense from a policy perspective. Companies that create more unemployment should pay more.

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Easy to say when you're not the one paying the bills. Some industries just have more seasonal variation - doesn't mean they're bad employers.

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Your payroll company should be handling all the quarterly reports and payments. The Washington ESD sends rate notices annually, usually in December for the following year. Make sure your payroll service knows about any claims so they can factor it into projections.

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Good point. I should follow up with them to make sure they're tracking this properly.

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Also make sure they're coding the separation reason correctly on the claim notice response. That can affect whether the claim gets charged to your account.

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I run a restaurant and deal with unemployment claims constantly. The thing that really impacts your rate is the dollar amount of benefits paid out, not just the number of claims. A long-term employee who maxes out their benefits will cost you more than someone who finds work quickly.

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Interesting - so there's an incentive for the employee to find work quickly from the employer's perspective too.

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Exactly. Though obviously the main thing is just having good business practices to avoid layoffs in the first place.

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Some employers try to pressure people not to file but that's illegal and just creates more problems down the road.

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Been running my business for 15 years and I've learned that fighting legitimate claims is usually not worth it. The time and energy spent contesting a valid layoff claim could be better used growing the business. Save your fights for the obvious cases of misconduct or voluntary quits.

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That's good advice. I was wondering if I should automatically contest everything but it sounds like that's not the right approach.

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Plus if you contest everything and lose, Washington ESD might scrutinize your future contests more carefully. Better to pick your battles.

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The maximum weekly benefit in Washington is pretty high compared to other states, so even one claim can add up. Make sure you understand the benefit calculation - it's based on the employee's wages with you and other recent employers, not just what you paid them.

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So if they worked somewhere else recently, that other employer shares the cost?

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Yes, benefits are charged proportionally to all base period employers. If you were their most recent employer, you'll likely get the biggest share though.

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Whatever you do, respond to any notices from Washington ESD promptly. Missing deadlines can result in automatic approvals even if you had valid grounds to contest. I learned this the hard way when our office manager was out sick and missed a response deadline.

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How long do you typically have to respond?

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Usually 10-14 days from the mail date, but check each notice carefully. Some have different timelines.

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And make sure someone in your office knows to watch for these notices. They can look like junk mail if you're not expecting them.

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I had a similar situation last year with our first claim. Used Claimyr to get through to Washington ESD when I had questions about our employer account - definitely worth it to avoid the endless hold times. The whole process was less scary once I actually talked to someone who could explain it.

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Did they help you understand the cost implications too?

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Yeah, they explained how the experience rating works and when we'd see rate changes. Made the whole thing much clearer.

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One thing to keep in mind is that your state disability insurance rate might also be affected. Some employers don't realize there are multiple programs involved. Make sure your payroll company is tracking all of them correctly.

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I didn't even think about disability insurance. I need to have a more detailed conversation with our payroll service.

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Yeah, there's unemployment insurance, disability insurance, and workers comp. They're all separate but related. Good payroll companies will help you understand the whole picture.

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honestly the whole employer side of unemployment is a mess. The rates change, the forms are confusing, and good luck getting anyone at Washington ESD on the phone to explain anything. At least employees can file online now but employers still get stuck with outdated processes.

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That's why services like Claimyr exist I guess. If the government system worked properly, nobody would need help getting through to them.

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True. Shouldn't have to pay extra just to talk to a government agency but here we are.

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The silver lining is that if this was genuinely your first claim in 3 years, it shows you're running a stable business. That history of low claims will help keep your rate from going up too much. Washington ESD does factor in your overall track record.

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That's reassuring. We've worked hard to maintain steady employment for our team.

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Exactly. The system is designed to reward good employers over time. One claim won't ruin you, especially if it was due to legitimate business reasons.

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Just remember to keep detailed records of everything - the separation reason, any documentation, correspondence with Washington ESD. If you ever need to dispute something later or if there are questions about future claims, having good records makes everything easier.

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Good advice. I'm going to start a file specifically for unemployment-related documents.

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Smart move. Also keep copies of any responses you send to Washington ESD. Their systems aren't perfect and sometimes things get lost.

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