Washington ESD unemployment benefits - who pays for unemployment when you collect?

So my employer is basically paying for my benefits? That makes me feel a little weird about collecting honestly.

Don't feel bad about it! They pay these taxes specifically so employees can get benefits if they're laid off through no fault of their own. It's literally what the system is designed for.

How do they calculate those rates? My company had a bunch of layoffs last year so I'm curious if that affects it.

Yeah it definitely affects it. Washington ESD looks at the employer's experience rating - more claims filed by their former employees means higher tax rates for that employer.

That sounds too good to be true. What's the catch?

No catch, just saves you the hassle of calling over and over. Way better than sitting on hold for hours or getting hung up on.

I might try this, I've been calling Washington ESD every day for two weeks with no luck getting through.

Thank you for explaining that! I had no idea there were both state and federal unemployment taxes.

Most people don't realize how the system works until they need to use it.

That makes more sense. So it's not like my specific employer is writing checks for my weekly benefits.

Exactly. It's pooled money from all employers across Washington state.

The federal government does provide some administrative funding, but regular state unemployment benefits come from state employer taxes. COVID was a special situation with federal programs like PUA and PEUC.

Got it, so normal times it's just the state fund from employer taxes.

A few states do have employee contributions but Washington is not one of them. Here it's entirely employer-funded through their payroll taxes.

Interesting, I always assumed it came out of my paycheck somewhere.

That's actually a really good way to think about it. Makes me feel better about collecting while I job search.

How much does it cost though?

Worth every penny considering how much time and stress it saves. Check their site for details.

That's correct. It incentivizes employers to avoid unnecessary layoffs since it directly affects their tax rate.

Makes sense from a policy perspective. Keeps employers invested in maintaining stable employment.

Generally correct - you have to be separated through no fault of your own to qualify. Quitting usually disqualifies you unless there are specific circumstances like unsafe working conditions.

That makes sense with the funding structure. Can't have people quitting just to collect benefits.

Washington's trust fund has been pretty stable compared to some other states. The employer tax system generally keeps it funded adequately.

Good to know. I was worried about benefit cuts while I'm collecting.

Same here! Glad I asked the question, learned a lot.

Wow that's a huge range. No wonder some employers try to fight unemployment claims.

Exactly. Every successful claim can potentially raise their future tax rates.

Oh yeah, Washington ESD takes that very seriously. There are penalties, interest charges, and they can put liens on business assets for unpaid unemployment taxes.

Good, that protects the system for everyone else.

How long did it take to get connected?

Less than 15 minutes. Way faster than trying to call on my own.

Agreed! I feel much better about collecting now that I understand the funding structure.

It's basically insurance like any other type. Employers pay premiums, workers get benefits when needed.

This is why I love these forums - actual helpful information from people who know what they're talking about.