Washington SUI Rates 2026: What Employers Pay for Unemployment Insurance

1. Overview of Washington SUI

Washington's State Unemployment Insurance (SUI) is a mandatory, employer-funded payroll tax administered by the Employment Security Department (ESD). Unlike PFML or WA Cares, employees do not contribute to SUI — the full cost falls on the employer.

The purpose of SUI is straightforward: it funds unemployment benefits for workers who lose their jobs through no fault of their own. When a former employee files a successful unemployment claim, the benefits they receive are drawn from this pool of employer-paid taxes.

Every employer with employees working in Washington is required to register with ESD and pay SUI taxes quarterly. There is no minimum employee count threshold — even a single W-2 employee triggers the obligation.

2. New Employer Rates

If you are a new employer in Washington, you will be assigned a new employer rate of approximately 1.0%. However, unlike states such as California that use a flat new employer rate for all industries, Washington varies the initial rate by industry classification.

Your NAICS code (North American Industry Classification System) determines which industry rate table applies to your business from day one. Industries with historically higher unemployment claim rates — such as construction and seasonal hospitality — receive higher new employer rates, while lower-risk industries like professional services pay less.

This means your industry classification matters immediately. Make sure your NAICS code is correct when you register with ESD, because an incorrect code could mean paying a higher rate than necessary.

3. Taxable Wage Base

Washington's SUI taxable wage base for 2025 is $72,800 per employee. This is the maximum amount of each employee's annual wages subject to SUI tax. Once an employee's year-to-date earnings exceed $72,800, you stop paying SUI on their additional wages for that calendar year.

To put this in perspective, here is how Washington compares to other major states:

Maximum Annual SUI Cost Per Employee

At the new employer rate of approximately 1.0%, the maximum annual SUI cost per employee is roughly:

$72,800 × 1.0% = $728 per employee per year

Compare that to California, where the same 1.0% rate on a $7,000 wage base would only cost $70 per employee. Washington employers pay roughly 10 times more in SUI per employee than California employers at the same rate. This is one of the most significant hidden costs of operating a business in Washington.

4. Experience Rating

After your business has sufficient claims history — typically four or more years of quarterly reporting — ESD transitions your account from the industry-based new employer rate to an experience-based rate.

Your experience rate is calculated based on the ratio of unemployment benefit charges against your account relative to your total taxable wages over the qualifying period. In simple terms:

• Fewer unemployment claims from your former employees = lower benefit charges = lower rate
• More unemployment claims = higher benefit charges = higher rate

Washington experience rates can range from as low as 0.13% to over 5.4% depending on your claims history. This is a significant spread — the difference between paying $95 per employee and $3,931 per employee annually (at the $72,800 wage base).

Employers with stable workforces and low turnover are rewarded with significantly lower rates over time, making workforce retention a direct financial benefit.

5. How Rates Are Assigned

ESD calculates and assigns SUI tax rates annually. Each year, typically in late fall, ESD mails a Tax Rate Notice to every registered employer with the rate that will apply for the upcoming calendar year.

Your total SUI rate is made up of several components:

• Experience-based component: Reflects your individual claims history (or industry rate if you are a new employer).
• Social cost factor: A shared cost component spread across all employers. This covers benefits that cannot be charged to individual employers, such as benefits paid to workers from employers who are no longer in business.
• Additional assessments: ESD may apply supplemental rates in certain years to maintain the solvency of the unemployment trust fund.

The final rate on your notice is the sum of these components. You can view your rate and account details online through the ESD employer portal.

6. Industry Rate Tables

Washington assigns new employer rates based on the average claims experience of your industry. Here are typical new employer rates for common industry sectors:

These are approximate ranges. Your exact rate depends on the specific NAICS code assigned and the current year's rate schedule published by ESD. Always confirm your rate on your annual Tax Rate Notice.

7. Reducing Your SUI Rate

Because your experience rating directly impacts your SUI costs, there are practical steps you can take to keep your rate as low as possible:

Maintain Low Turnover

The single most effective way to reduce your SUI rate is to retain employees. Every unemployment claim charged to your account pushes your experience rating higher. Investing in employee satisfaction, competitive wages, and good management practices pays off directly through lower SUI costs.

Contest Improper Unemployment Claims

When a former employee files for unemployment, ESD sends a notice to the employer. You have the right — and the financial incentive — to respond and contest claims that are not legitimate.

Document Terminations Thoroughly

Maintain clear records of performance issues, disciplinary actions, and the reasons for any termination. When contesting a claim, documentation is your strongest evidence. Without it, ESD will typically side with the claimant.

Use Proper Separation Procedures

• Provide written warnings before termination when possible
• Document the specific reason for separation
• Have the employee sign acknowledgment of policies and warnings
• Keep separation records for at least four years

8. Comparison with Other States

Washington's SUI program stands out nationally due to its exceptionally high taxable wage base. Here is a side-by-side comparison with other major states:

Even though Washington's rate may appear lower than some states, the massive wage base means the actual dollar cost per employee is significantly higher. A Washington employer at a 1.0% rate pays roughly the same per employee as a California employer at 3.4% — and once experience rating kicks in, Washington rates can climb much higher.

9. Filing and Payment

Washington SUI taxes are filed and paid quarterly through the Employment Security Department. Here is what you need to know:

Quarterly Due Dates

Electronic Filing

ESD requires employers to file quarterly tax reports electronically through the ESD employer portal (EAMS — Employer Account Management Services). The quarterly report includes:

• Total wages paid to each employee during the quarter
• Hours worked by each employee
• SUI tax owed based on taxable wages and your assigned rate

Payment can be made via ACH debit, credit card, or electronic check through the portal. Paper filing is only available by special arrangement for employers who demonstrate hardship.

Penalties for Late Filing

Late reports and payments incur penalties and interest. ESD assesses a penalty of 10% of the tax due for late payments, plus interest that accrues monthly. Repeated late filings can also trigger an audit or higher scrutiny of your account.

10. Frequently Asked Questions

Do employees pay any portion of SUI in Washington?

No. Washington SUI is 100% employer-funded. Employees do not contribute to unemployment insurance taxes. (This is separate from PFML and WA Cares, which have employee-paid components.)

What if I have employees in multiple states?

You pay SUI taxes to the state where the work is performed. If you have employees working in Washington and other states, you pay Washington SUI only on wages earned by employees working in Washington.

Can I get my SUI rate reduced mid-year?

No. SUI rates are set annually and apply for the full calendar year. You cannot request a mid-year adjustment. However, if you believe your rate was calculated in error, you can appeal within 30 days of receiving your Tax Rate Notice.

What happens if I don't pay SUI taxes?

Failure to register or pay SUI taxes can result in penalties, interest, liens on business assets, and personal liability for corporate officers. ESD can also report delinquent employers to collection agencies and the state Department of Revenue.

Is SUI deductible as a business expense?

Yes. SUI taxes are deductible as an ordinary business expense on your federal tax return. This effectively reduces the net cost by your marginal tax rate.

How do I check my current SUI rate?

Log in to the ESD Employer Account Management Services (EAMS) portal to view your current rate, account history, and benefit charges. Your annual Tax Rate Notice is also mailed to your address on file.