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Senate hears bill to shift paid family and medical leave premium setting to actuarial approach amid debate over 1.2% cap
Summary
Senate Bill 5292 would direct the Employment Security Department’s Office of Actuarial Services to set paid family and medical leave rates using a forward‑looking (actuarial) approach and require a three‑month reserve; business groups opposed removal of the current 1.2% statutory cap.
The committee considered Senate Bill 5292, which would change how the state’s Paid Family and Medical Leave (PFML) premiums are set by authorizing ESD’s actuarial office to set rates using forward‑looking actuarial estimates rather than the current retrospective statutory formula. The bill would also add a requirement to close a rate collection year with a three‑month reserve and would eliminate the current statutory 1.2% premium cap.
Why it matters: JLARC and ESD both recommended moving to an actuarial rate‑setting approach to improve solvency and reduce volatility. Business groups cautioned that removing the 1.2% cap could…
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