January 2022: UPDATE: Washington Governor Clarifies that Employers Are Still “Legally Obligated” to Pay Premiums Under the Washington Cares Act

04 Jan


Update Applicable to:
All employers in the state of Washington

What happened?
In our previous communication here, we informed you about the Washington Cares Fund, which creates a mandatory, public, state-run long-term care insurance program for workers. This is an update to that article.

What are the details?
In light of a class-action lawsuit filed against the Washington Cares Fund and a pending citizens’ initiative (I-1436), which would make it optional to participate in Washington’s long-term care insurance, Washington Governor Jay Inslee announced on December 17, 2021, that he and the State Legislature have been having ongoing discussions about the long-term care legislation and have identified some areas that need adjustments.

As a result, Governor Inslee is ordering the state Employment Security Department not to collect the long-term care insurance payroll taxes from employers that were scheduled to begin in January.

On December 23, 2021, Governor Inslee issued a press release clarifying that starting January 1, 2022, “employers will still be legally obligated to pay the full amount owed to state ESD [Employment Security Department] to begin the long-term care program” under the Washington Long-Term Services and Supports Act until the legislature changes the law.

He added that “[a]s an employer, the state of Washington is following the law and will have to begin collecting money from state employee paychecks as of January [1].” Based on this latest clarification, employers are expected to begin long-term care premium deductions on January 1, 2022, to avoid potential costs if the legislature fails to amend the law.

For more information, please see the links below:

Governor Jay Inslee Statement (December 23, 2021)

Governor Jay Inslee Statement (December 17, 2021)

Article 1Article 2Article 3

What do employers need to do?
Employers should review the links above and per Governor Inslee’s warning, begin collecting premiums from employees’ paychecks to avoid the chance employers would have to pay the cost of the premiums themselves if the legislature fails to change the law.