Washington ESD unemployment cost burden - who actually pays for benefits?

Wait so my current employer is basically paying for my unemployment? That seems awkward...

Not exactly your current employer - it's more like a pool that all employers contribute to. Think of it like insurance where everyone pays in but only some people need to use it.

That makes sense - gives employers incentive to keep people employed rather than constantly hiring and firing

Yeah but some industries like construction or retail have seasonal layoffs that aren't really their fault. The system tries to account for that but it's not perfect.

What are the few specialized programs where it's different?

Things like federal extended benefits during recessions, or some of the pandemic programs we had. But regular state UI is employer-funded.

The pandemic programs were weird because they were federally funded but administered through state systems like Washington ESD. Created a lot of confusion.

Is that legitimate? Seems weird to pay someone to help you call a government office.

Yeah it's real - check out claimyr.com. They basically handle the waiting and calling for you. I was skeptical too but it actually worked when I needed to talk to someone about my adjudication.

So when I was working, my employer was paying extra taxes based on my wages that I never saw?

Exactly. It's calculated as a percentage of wages up to a certain limit. In Washington it's currently 0.4% for new employers but can go higher for companies with more claims history.

The rate also varies by industry. Construction companies typically pay more than office-based businesses because they have more seasonal layoffs.

That's probably why some employers fight unemployment claims even when they're legitimate. Higher claims = higher taxes for them.

There are protections against that though. Employers can't retaliate against employees for filing legitimate claims. But you're right that there's a financial incentive for them to contest claims.

Wow I had no idea employers were paying so much extra on top of salaries. Makes me feel less guilty about collecting benefits.

That's exactly the point of the system - it's insurance that employers pay for to protect their workers. You earned those benefits through your work history.

Right, and the amounts are calculated based on your earnings history, so if you made more money, you get higher benefits. It's proportional to what your employer paid in taxes on your wages.

Until you need to actually deal with Washington ESD to get your benefits... then the system feels pretty broken

That's where services like Claimyr come in handy. The funding system works fine but the administration is a nightmare. Having someone who knows how to navigate the phone system saves so much frustration.

Good point. The federal government can extend benefits beyond the normal 26 weeks when unemployment is high, and they fund those extra weeks.

So right now I'm just getting regular state benefits funded by employer taxes, but if I exhaust those there might be federal extensions available?

Depends on the unemployment rate and federal legislation. Right now there aren't any federal extensions active, but that could change if economic conditions worsen.

Yeah it's a dedicated insurance fund, not welfare. Makes the politics around it less complicated since it's not competing with other government spending.

Though some states have had to borrow from the federal government when their UI funds ran dry during recessions. Washington has generally managed their fund pretty well compared to other states.

What's an experience rating?

It's basically your company's history of unemployment claims. New businesses start at a standard rate, but over time the rate adjusts based on how many former employees have filed for benefits. More claims = higher rates.

This is why some employers will contest claims even if they know they'll lose. Fighting a claim can delay the impact on their experience rating for a year or two.

Generally you can't get unemployment if you quit without good cause. The system is designed to help people who lose jobs through no fault of their own - layoffs, company closures, etc.

what counts as good cause though? my boss is making my life miserable but I don't know if that qualifies

That's called constructive dismissal - if working conditions are so bad a reasonable person would quit. But it's hard to prove. You'd need documentation of the problems and attempts to resolve them.

This is exactly when Claimyr helped me out. Instead of spending hours on hold, they handled getting me connected to an actual person who could explain what was happening with my claim.

I'll check that out. At this point I'm willing to try anything to get some answers about why my claim is taking so long.

adjudication is the worst part of the whole system. they're trying to verify your eligibility but there's no transparency about what's taking so long

Yeah Washington generally has good business policies. The UI system is well-funded and the rates are competitive. Some states have much higher employer costs.

The key is that Washington ESD has been pretty conservative with their reserve fund management. They didn't have to borrow federal money during the pandemic like a lot of other states did.

Exactly right. You earned those benefits through your work history. The whole point of the system is to provide a safety net for workers who lose jobs through no fault of their own.

Yeah this whole thread has been really helpful. I was feeling guilty about collecting benefits but now I understand it's literally insurance that was paid for on my behalf.

And remember, you're also required to actively look for work while collecting benefits. It's not just free money - there are obligations that come with it.

Which states make employees pay? I'm curious now.

alaska, new jersey, and pennsylvania i think. maybe one or two others. but most states are like washington where only employers pay

Rhode Island too. But yeah, the vast majority of states fund UI entirely through employer payroll taxes. It's designed to be a business cost, not a worker cost.

Right, and there's a lag time too. The impact on their rates doesn't hit immediately, so they might not see the full cost for a year or two.

Makes me mad that employers would fight legitimate claims just to save money on taxes. But I guess from their perspective it's a business decision.

Most employers don't contest legitimate claims. It's usually only when there's a genuine dispute about eligibility - like whether someone was fired for cause or quit voluntarily.

Same here! I was thinking it was like welfare where there's a limited pot of money. But it's actually insurance that scales with the number of people paying in.

The system is designed to handle normal levels of unemployment. It only gets stressed during major recessions when claims spike but the tax base shrinks at the same time.

Even then, there are federal backstops and the ability to adjust tax rates to rebuild the fund. It's a pretty resilient system overall.

Good point. Workers comp covers injuries and illnesses from work, UI covers job loss. Both are employer-funded insurance systems but they serve different purposes.

And neither one comes out of employee paychecks in Washington. It's all part of the cost of doing business and employing people.

Definitely worth understanding before you need it. I wish I had known all this before I got laid off - would have saved me a lot of stress and guilt.

And if you do end up needing to file, remember that services like Claimyr exist if you run into problems reaching Washington ESD. Better to know your options ahead of time than scramble when you're already stressed about losing your job.

The peace of mind is worth it. Knowing that unemployment insurance is there and properly funded makes job loss less terrifying.