SB 5378
In CommitteeSenate
PFML grants/school districts
Expanding access to grants within the paid family and medical leave insurance program for small school districts.
This status may be delayed. See Action History below for the latest updates.
How does a bill become law?
- Introduced: The bill is filed and assigned a number.
- Committee: A subject-matter committee holds hearings, takes public testimony, and decides whether to advance the bill.
- Floor Vote: The full chamber (House or Senate) debates and votes on the bill.
- Opposite Chamber: The bill repeats the committee and floor vote process in the other chamber.
- Governor: The Governor reviews the bill and decides whether to sign or veto it.
- Signed: The bill has been signed into law.
AI Analysis
This bill expands access to state grants for small school districts and small businesses to help offset costs of covering employees on family or medical leave. It increases the range of eligible employers, raises the maximum grant amount for temporary replacements, and adds a reimbursement option for wage-related costs.
- Expands eligibility for PFML grants to include school districts of the second class (a specific classification of small school districts in Washington).
- Allows employers with 51 to 150 employees and those with 50 or fewer employees who pay all premiums themselves to apply for grants — previously only employers with 50 or fewer were eligible.
- Provides a $3,000 grant for hiring a temporary worker to cover an employee on family or medical leave for 7 or more days.
- Provides up to $1,000 reimbursement for 'significant additional wage-related costs' (e.g., overtime paid to other staff) due to an employee’s leave.
- Limits each employer to 10 grants per calendar year and one grant per employee on leave.
- Requires employers to submit written documentation proving the temporary hire or extra wage costs were directly due to PFML use.
- Requires employers with fewer than 50 employees who receive a grant to pay all PFML premiums for 3 years after receiving the grant.
- Excludes employers with approved voluntary plans (private plans that replace the state program) from receiving grants.
Who is affected
- Small school districts — Small school districts (specifically those classified as 'school districts of the second class') may apply for grants to help cover costs of replacing employees on leave.
- Small businesses — Employers with 51 to 150 employees and employers with 50 or fewer employees who pay all premiums themselves may apply for grants to offset costs of temporary replacements or increased wages during employee leave.
- Employees using family or medical leave — Employees on family or medical leave indirectly benefit because their employers may be better able to maintain operations and support coverage during their absence.
- Washington State Employment Security Department — The Washington State Employment Security Department (ESD) will administer the grant program, including reviewing applications and issuing payments.
Pro/Con Analysis
Stronger case for benefits
Potential Benefits (5)
Expanding grant eligibility to school districts of the second class (small, often rural or low-enrollment districts) and providing up to $3,000 for temporary replacements directly helps these districts maintain instructional continuity during staff absences — reducing disruption for students and avoiding costly long-term substitutes.
EducationPeopleRef: Sec. 1(2)(c), Sec. 1(3)(a)Grant support for temporary hires and wage-related cost reimbursement ($3,000 and $1,000, respectively) helps small employers (including those with 51–150 employees and those paying all premiums) offset the real costs of leave coverage — reducing the risk of business disruption or staff burnout during employee leave.
Business & EmploymentPeopleRef: Sec. 1(2)(a), Sec. 1(3)(a), Sec. 1(3)(b)Allowing reimbursement for 'significant additional wage-related costs' (e.g., overtime) helps small employers who otherwise would absorb unpaid labor or cut services to cover for leave-takers — supporting small business viability without requiring full-time replacements.
Business & EmploymentPeopleRef: Sec. 1(2)(b), Sec. 1(3)(b)In small school districts, especially in rural or underserved areas, the ability to quickly replace staff (e.g., bus drivers, custodians, or security personnel) on leave improves operational safety and continuity — indirectly supporting student safety and school function.
Public SafetyPeopleRef: Sec. 1(2)(c), Sec. 1(3)(a)By broadening eligibility beyond the original 50-employee threshold, the bill includes mid-sized small businesses (51–150 employees) that were previously excluded — many of which are family-owned or locally rooted and face similar staffing challenges as micro-businesses.
Business & EmploymentPeopleRef: Sec. 1(2)(a), Sec. 1(2)(b)
Potential Concerns (5)
Employers with fewer than 50 employees who receive a grant must pay all PFML premiums for three years afterward — effectively imposing a multi-year premium surcharge on the smallest employers, which may offset or exceed the grant value, especially for businesses with low margins or few employees on leave.
Business & EmploymentPeopleRef: Sec. 1(2)(b), Sec. 1(6)Expanding eligibility to employers with 51–150 employees and to small employers who pay all premiums themselves may increase administrative burden and compliance costs for ESD, but the primary effect is to dilute limited grant funds across a broader pool of employers — many of whom are not the smallest or most financially strained — reducing per-employer benefit value.
Business & EmploymentPeopleRef: Sec. 1(2)(a), Sec. 1(2)(b)The $3,000 grant cap and the restriction that employers can only receive one grant per employee (and max 10 per year) may be insufficient for employers facing multiple overlapping leaves or longer-term staffing needs — especially in education, where multi-leave coverage may be needed simultaneously.
Business & EmploymentLean peopleRef: Sec. 1(3)(c), Sec. 1(4)The requirement for written documentation and the premium surcharge on small employers who receive grants increases administrative complexity and compliance risk — disproportionately affecting small businesses and school districts with limited HR or legal capacity.
Business & EmploymentLean peopleRef: Sec. 1(5), Sec. 1(6)Funding from the existing Family and Medical Leave Insurance Account may strain the program’s long-term solvency, especially if grant usage grows — potentially leading to future premium increases or benefit cuts that affect all workers and employers.
FinancialLean peopleRef: Sec. 1(7), Sec. 1(9)
Who Is Most Affected
Small school districts (second class) gain direct financial relief to cover temporary staff during leave, reducing class disruptions and maintaining operations — especially valuable in rural or underfunded districts.
Small businesses (50 or fewer, especially those paying all premiums) benefit from cost offsets, but face a 3-year premium surcharge if they receive a grant — which may outweigh the grant for very small or low-margin firms.
Mid-sized small businesses (51–150 employees) gain new access to grants previously unavailable to them — helping them manage leave-related staffing gaps without expanding full-time staff.
Employees on PFML benefit from more stable workplace coverage and reduced pressure on co-workers — but indirectly; the bill does not expand leave benefits, only employer support.
The Washington State Employment Security Department gains administrative responsibility but no new funding — increasing workload without additional resources, potentially straining capacity over time.