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Washington Delays Implementation of Long-Term Care Act

On December 17, 2021, Washington Governor Jay Inslee announced that the state would pause implementation of the Washington Cares Fund, intended to provide a long-term care benefit for Washington workers.

Initially set to begin on January 1, 2022, the fund would require employers with Washington employees to collect a payroll deduction of 0.58 percent. Those funds would then help fund long-term care costs beginning in 2025.

Implementation was paused so the state legislature could improve the law during the 2022 legislative term. Until a future announcement is made, employers will not be required to collect the payroll deductions or remit them to the state. All penalties for non-compliance will also be waived during the pause. In addition to legislative action, Washington is expected to provide more regulatory guidance.

In November, a class action lawsuit was filed against the Act, challenging the Act is unenforceable on the grounds if violates ERISA and federal and state laws governing employee benefit plans. See Pacific Bells LLC et al v. Inslee et al, No 2:21-cv-01515, (W. Dist. WA). Nov. 9, 2021. The class action lawsuit is expected to continue despite the delay in enforcement.

Because it is unknown how long this pause will last, employers are encouraged to continue to prepare for implementation.

Don’t miss an update – visit OneDigital’s Compliance Confidence Fresh Thinking blog for the latest developments around employer compliance. As always, if you have more questions, please reach out to your OneDigital consultant.

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