Personnel Law Updates from 2026 Legislative Session

The Washington State Legislature made a handful of changes to personnel-related laws in the 2026 legislative session. This blog will cover the 2026 changes (and also remind readers of approaching deadlines for personnel-related laws passed in 2025). Local governments should review their personnel policies to ensure consistency with the changes to the various personnel laws.

Washington State Paid Family and Medical Leave: SB 5292 and HB 2345

Almost 10 years ago now, Washington State adopted its mandatory Paid Family and Medical Leave (PFML) program, which provides paid leave to employees for various family and medical circumstances, including birth or placement of a child and care of family members with serious health conditions.

SB 5292 – Changing the premium payment formula change

Local governments must collect premium payments for the PFML program and remit those payments to the Employment Security Department (ESD). The premium rate is set by ESD based on the statutory formula set forth in RCW 50A.10.030. Effective January 1, 2028, the PFML premium rate will be based on the annual report submitted by the Washington State Office of Actuarial Services rather than the statutory formula. See SB 5292.

HB 2345 – Shifting the employer premium payment share to family leave

The IRS released guidance that both family and medical leave benefits are subject to federal income taxes, while only medical leave is subject to federal employment taxes. See  IRS Bulletin 2025-7 and Notice 2026-6.

In order to help employers avoid additional federal tax liabilities, the legislature changed the premium allocation by shifting the employer responsibility share for premiums from medical leave to family leave. See the Final Bill Report for HB 2345.

Although the responsibility shifts, the employer will maintain the approximate same level of financial obligation as it had prior to the shift.

Under the reallocation set forth in HB 2345, employees are responsible for 100% of the medical leave share while the family leave portion is shared by employees and employers based on a statutory formula. The new formula sets the maximum employee deduction for family leave as the difference between:

• the full amount of the premium required for family leave plus 45% of the full amount of the premium required for medical leave; and
• the full amount of the premium required for medical leave.

Note that employers with fewer than 50 employees are not required to pay the employer portion of the premiums.

As explained by the labor and employment law firm Littler in their blog Washington Updates Paid Family and Medical Leave Premium Split to Align with Federal Tax Guidance:

The bill does not specify when employers must adjust their payroll systems to reflect the new premium split. However, it appears the adjustment will align with the normal annual recalculation schedule. By law, Washington’s Employment Security Department recalculates the premium rate annually in October based on program usage and premiums collected the previous year.  The new adjusted rate takes effect on January 1 of the following calendar year. The Department will issue implementation guidance later this year to help employers understand how to transition to the revised premium structure.

Ban on Noncompete Agreements: HB 1155

Effective June 30, 2027, noncompete agreements are void and unenforceable in the State of Washington. See HB 1155.

Noncompete agreements include agreements that:

• prohibit an employee or independent contractor from engaging in a lawful profession, trade, or business; or
• threaten or require an individual return or repay a right, benefit, or compensation as a consequence of the individual engaging in a lawful profession, trade, or business.

The ban on noncompete agreements applies to all employers, including state and local governments. See HB 1155 and RCW 49.17.020(4).

By October 1, 2027, employers must make reasonable efforts to notify current or former employees with noncompete agreements that the agreement is no longer enforceable.

Immigrant Worker Protection Act: HB 2015

The state legislature adopted the Immigration Worker Protection Act in HB 2105 to clarify employers’ rights and responsibilities when engaging with federal immigration enforcement agencies that undertake inspections of I-9 forms.

An I-9 form refers to the U.S. citizenship and immigration services employment eligibility verification form used by employers to comply with federal law to verify employee identity and work authorization.

Effective June 11, 2026, employers must notify an employee and their union representative within five business days of receiving notice of an I-9 inspection by a federal agency and must provide a copy of the results to the same within five days of receiving the results.

The state attorney general will post resources to assist employers with implementing the new law by September 1, 2026.

Ban on Microchips for Employees

In the latest version of “Am I reading this right?,” there is a new law prohibiting employers from requesting, requiring, or coercing employees or applicants to have a microchip implanted under their skin (see HB 2303)

The LexisNexis article Washington Joins States Limiting Employer-Mandated Worker Microchipping provides context behind the law’s purpose, which was focused on prohibiting this extreme type of employee surveillance.

Prior Changes: To Implement in 2026 and 2027

Employers should also be mindful of the following changes to the Washington Fair Chance Act, the Washington Heathy Starts Act, and WA Cares, which occurred in the 2025 legislative session with effective dates approaching in 2026 and 2027. Many of these changes were detailed in the 2025 Personnel Legislation Round-Up blog.

Washington Fair Chance Act

Effective July 1, 2026, employers of 15 or more employees may not ask about criminal history or request a background check until after making a conditional job offer (with some exceptions, including positions in law enforcement).

Employers also may not reject an otherwise qualified candidate based on an applicant’s juvenile conviction record or arrest record (unless they are currently out on bail, and a trial is pending). Employers can reject an otherwise qualified candidate based on their adult conviction record if they have a legitimate business reason. That law extends to employers with fewer than 15 employees on January 1, 2027. See RCW 49.94.010 and HB 1747.

Washington Healthy Starts Act

Effective January 1, 2027, pregnancy and post-partum workplace accommodation requirements apply to all employers, regardless of size.

These workplace accommodation requirements include, for example, limits on lifting over 17 pounds and a paid break time and location for an employee to express breast milk for two years after a child’s birth. See Chapter 49.92 RCW.

WA Cares

Effective July 1, 2026, employees who relocate outside of Washington may continue participation in the WA Cares Fund and may access benefits starting in July 2030, so long as the employee contributed to the fund for at least three years and opted in within one year of leaving the state.

For more information, see Taking your WA Cares benefit out of state.

Conclusion

MRSC has a series of webpages on personnel-related topics that provide more in-depth information about the PFML, WA Cares, and more. These can be found under MRSC’s Personnel & Human Resources Topics webpage. MRSC will be updating its webpages to reflect new legislative changes.