Who pays for unemployment benefits in Washington - confused about funding sources

So employees don't pay anything toward unemployment benefits? That's different from what I thought.

Correct for Washington state - employees don't contribute to UI. It's entirely employer-funded through state unemployment taxes.

So I never paid into it directly? That makes me feel less guilty about collecting benefits then.

exactly, you earned those benefits through your work history

You might be thinking of other deductions like Social Security or disability insurance. Washington unemployment insurance is paid entirely by employers.

oh ok that makes sense, I was confusing it with other stuff

That's why some employers fight unemployment claims so hard - it affects their tax rate!

Exactly. It's called experience rating. Employers with more claims face higher UI tax rates in future years.

Wait so I never paid into this system directly? That seems weird but also makes me feel less guilty about filing if I need to.

Yeah exactly, it's not like you're withdrawing from some personal account you paid into. It's an insurance system your employer funded.

What's an experience rating? Never heard of that before.

It's basically Washington ESD's way of tracking how many former employees file for unemployment. More claims = higher tax rates for that employer.

I had the same problem until I found Claimyr (claimyr.com). They help you get through to Washington ESD agents when you can't reach them normally. There's a video demo at https://youtu.be/7DieNd3C7zQ that shows how it works.

Really? I'll check that out. I've been calling for 3 weeks straight with no luck.

This is why some employers fight unemployment claims so hard - it can raise their tax rate if they have too many successful claims against them.

Oh that makes sense why my old boss was so weird about people filing. I thought he was just being mean but there's actually a financial reason.

How much does that service cost? I've been trying to reach someone for weeks.

It's worth it when you can't get through the regular way. Much easier than redialing for hours.

I might try that - I have other questions about my claim status too

Yeah, it creates an incentive for employers to avoid layoffs when possible since it directly affects their tax rate.

How much does that cost? I'm already stressed about money and don't want to pay for something that should be free.

It's worth it when you can't get through any other way. The site is claimyr.com if you want to check it out. I was stuck in adjudication limbo for weeks.

Never heard of this but the calling situation with ESD is definitely broken. Might have to try it if I can't reach them soon.

So if I file a claim, my employer's rate might go up? Should I feel bad about that?

Don't feel bad - this is exactly what the system is designed for. If you lost your job through no fault of your own, you're entitled to benefits.

That's correct. It's a dedicated trust fund maintained by employer contributions. The federal government only provides administrative funding and emergency extensions during crises.

Yeah and that's why there's so much scrutiny on claims - it's not unlimited government money, it's a finite fund

Exactly! It's earned insurance, not welfare. People shouldn't feel guilty about claiming benefits they're entitled to.

That makes me feel better about receiving benefits. I was worried I was somehow taking money from taxpayers.

Yes, any employer that pays wages is required to pay unemployment insurance taxes, regardless of whether you worked full-time or part-time for them.

That's good to know. I was worried my part-time job wouldn't count toward my benefits.

Do you know what happens if the trust fund runs out of money? Does the state have to bail it out?

The state can borrow from the federal government if needed, but ultimately employer tax rates would increase to replenish the fund.

How much does that typically cost employers? Just curious about the burden.

For most stable employers it's less than 1% of wages, but companies with high turnover or lots of layoffs can pay much more.

Correct. FUTA covers administrative costs and provides funding for extended benefits during high unemployment periods.

thanks for clarifying that

Exactly! The funding structure makes sense but the actual administration is terrible. I've been waiting 3 weeks just to talk to someone about my adjudication.

That's exactly why I ended up using Claimyr - the wait times through normal channels are insane. At least I could get real answers about my claim instead of just checking the website over and over.

I might have to look into that service too. This system is so frustrating when you actually need help.

Good to know. I'm just filing for regular unemployment so sounds like it's all employer funded then.

that's not really how it works but ok

While some costs might be passed on, unemployment insurance is a small percentage of overall business expenses for most employers.

The misinformation is frustrating. It's literally insurance that employers pay for - no different from health insurance premiums.

Exactly! And workers earn the right to benefits by working in covered employment.

Independent contractors typically aren't covered by regular UI since no employer is paying taxes on their behalf. They may qualify for other programs during emergencies.

That makes sense - no employer contributions, no coverage.

As someone who files unemployment claims for our company, this is accurate. The state sends us a tax rate notice every year based on our experience.

Thanks for the inside perspective. Makes me feel better about filing knowing it's not coming out of other employees' paychecks or anything.

There is a small federal unemployment tax (FUTA) but the majority comes from state employer taxes. Washington ESD administers the state program.

Most states use similar employer-funded systems, but the tax rates and benefit formulas vary significantly between states.

Good to know it's not totally different then

How long did it take them to connect you to someone at Washington ESD?

Much faster than calling directly. I was able to get my questions answered about my benefit amount within a day.

That's a good point. I did work for almost 2 years at my last job so I definitely earned eligibility.

Exactly. The employer taxes are just the mechanism for funding, but you earned the right to benefits through your employment.

Same here! This thread really helped clarify things for me.

It's definitely not intuitive, but makes sense once you understand it's essentially insurance coverage.

Wow that's way more than I was expecting. Good to know Washington has decent benefits compared to other places.

Yeah but you have to have pretty high wages to get the maximum. Most people get way less than that.

Well, their rate does increase based on claims filed by former employees, so there is some connection between layoffs and higher taxes.

true but they act like it's coming directly out of their pocket personally

I've been hesitant to use outside services but might have to. Can't get through any other way.

Same here, the wait times are insane

Not immediately - experience rating is typically calculated annually, so your claim would affect their rate for the following year.

Got it, thanks for explaining that

It really does help when you can't get through the regular phone lines. Check out their demo video to see how it works.

Will do - desperate times call for desperate measures!

Same! Really changed my perspective on the whole system.

It's important to understand these systems. Helps reduce the stigma around using benefits you're entitled to.

For regular UI benefits, it's entirely employer-funded. The state only provides administrative oversight and facilities.

Clear as mud now - thanks for all the explanations!

Exactly how I felt! Good to know we're not alone in being confused about this.

The system should be more transparent about how it works. Would reduce a lot of confusion and stigma.

That does make sense from a policy perspective. Wish it actually prevented more layoffs though.

It probably does prevent some, but when companies are struggling they don't have much choice regardless of the tax implications.

You're right. I was overthinking it. Thanks everyone for explaining how this all works - makes me feel much better about filing.

Good luck with your claim! The Washington ESD website can be confusing but the actual filing process isn't too bad.

Thanks for the tip! I'll gather all that stuff before I start the application.

And if you run into issues reaching ESD by phone, definitely consider that Claimyr service someone mentioned earlier. I used it last month when I couldn't get through and it was a lifesaver.

Yeah I bookmarked their site just in case. Hopefully I won't need it but good to have as backup.

It's more accurate to say all employers collectively fund the system through their tax contributions to Washington ESD.

Yes, because they have larger payrolls. The tax is calculated as a percentage of wages paid to employees.

Plus their experience rating affects the percentage rate they pay. More layoffs = higher rate.

Thanks for the insider perspective! That helps clarify things a lot.

So the trust fund can run low? What happens then?

If the trust fund gets too low, employer tax rates increase across the board to rebuild it. That's what happened during the recession.

It's been that way since the 1930s. It's considered part of the social safety net.

That's actually part of the system's design - to discourage unnecessary layoffs. But sometimes layoffs are unavoidable due to economic conditions.

if only it were that simple lol

Yes, it's designed to make employers more accountable for their workforce decisions while ensuring the system remains funded.

The rates can vary significantly. New employers start at a standard rate, then it adjusts based on their track record.

You shouldn't feel guilty at all. You earned those benefits through your work history and your employer's contributions to the system.

Same here - I was worried I was somehow taking money from other workers' paychecks

I keep seeing people mention this service. Might be worth trying since I have questions about my claim too.

Better than spending all day trying to call and getting disconnected

Right? I feel like they should explain this stuff better when you first file for benefits.

There is information about funding on the Washington ESD website, but it's not prominently featured in the filing process.

That's actually a great analogy. And like other insurance, higher risk (more claims) means higher premiums (tax rates).

wow that actually makes it super clear, thanks

Well, employers are taxpayers too, but you're right that it's not funded through general tax revenue like some other programs.