Washington’s paid family and medical leave premium goes up on January 1, 2027, and most of the increase lands on workers rather than employers. The state Employment Security Department announced on October 16 that the total premium rate will rise to 1.2% of wages, from 1.13% in 2026.

Employees will carry 70.7% of that premium and employers 29.3%, the department says. In plain numbers, a worker’s share of the 2027 premium comes to about 0.85% of each paycheck’s covered wages, and the employer’s share comes to about 0.35%.

For a household on a wage budget, the practical question is what to adjust before the first January paycheck. Anyone paid by a Washington employer should expect a slightly larger deduction on the first check of 2027. On $60,000 in wages, the total premium would work out to $720 a year at 1.2%, compared with $678 at the 2026 rate of 1.13%, according to the department’s rates.

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How the new 1.2% rate compares with 2026

The rate moves by seven hundredths of a percentage point, from 1.13% to 1.2%. That is a small step on a single check, but it applies to every covered paycheck for the whole year, and the department sets the rate again each October.

The department says it recalculates the rate every October using program usage and the previous year’s premiums. The program is being used heavily: the department’s release says more than 221,000 people claimed Paid Leave benefits in the first nine months of 2026, and that the program paid out more than $1.8 billion in that time.

Why employees carry 70.7% of the cost

The 70.7% employee and 29.3% employer split is set out in the same release, and it applies to the total premium. Employers collect the employee share through payroll and send both shares to the state.

A new state law also takes effect in 2027. Second Substitute House Bill 2345 was passed in response to new IRS guidance on tax liability for Paid Leave, according to the department. The bill changes how employer and employee contributions are divided between the family leave premium and the medical leave premium. It does not change the overall employer and employee split of 29.3% and 70.7%.

Small businesses and the employer share

Employers with fewer than 50 employees do not have to pay the employer share unless they choose to, the department says. Those businesses must still collect the employee premium, or pay it on their employees’ behalf.

The department calculates business size once a year, on September 30. A worker at a small business therefore still sees the employee deduction, even though the employer’s 29.3% may not be paid by the business.

Which paychecks and reports use which rate

The new rate does not touch 2026 reporting. Employers use the 2026 rate and split for their third and fourth quarter 2026 reports, the department says, and the third-quarter reports are due in October.

Payroll offices will switch to 1.2% for wages paid on and after January 1, 2027. Workers can look at their final 2026 pay stub, find the line for paid family and medical leave, and compare it with the first stub of the new year. The deduction that first appears there is the figure the department’s release describes.

What the January deduction leaves open for household budgets

The department has not said whether the rate will move again for 2028. It says only that the rate is recalculated each October from usage and from the prior year’s premiums, and that more than 221,000 claimants drew benefits in nine months of 2026.

For a household already stretched by housing, utility and grocery bills, the open question is where an extra few hundred dollars a year in payroll premiums gets absorbed. That is a budgeting question as much as a payroll one, and it comes before the first check of 2027.

Planning for a bigger January deduction?

Washington’s premium rises to 1.2% on January 1, and workers pay 70.7% of it. Households that wait for the first stub of 2027 to adjust may find the gap between take-home pay and fixed bills has already opened.

The Benefits Checklist does not cover paid leave premiums. It turns the same household-cost worry into a scan of 11 benefit programs, with the 2026 income limits and a 50-state phone directory, plus a printable tracker that comes with the download.

Get The Benefits Checklist to scan 11 programs before the January 1 payroll change →

More Financial Reading

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This article was produced with AI assistance and edited for accuracy against the sources linked above.