On March 5, I reported that the Employment Security Department (ESD) confirmed that 106 striking workers had received 415 weeks of unemployment insurance (UI) benefits since a new law allowing striking workers to collect unemployment benefits took effect Jan. 1. On July 10, The Washington State Standard reported those figures had climbed to 138 workers receiving 642 weeks of benefits totaling nearly $506,000.
Those numbers could soon rise again. The newspaper reported that striking workers at Hilton’s Embassy Suites in Seattle’s Pioneer Square have also applied for benefits.
Supporters of Senate Bill 5041 argued that allowing striking workers to collect unemployment benefits would rarely happen, would not encourage longer strikes and would not impose meaningful costs on the unemployment insurance system. Washington Policy Center argued that regardless of how many workers ultimately collect benefits, repurposing an employer-funded safety net into one that also subsidizes strikes is misguided.
So far, the fiscal impact has been relatively small. An ESD news release issued July 15 reported that 61,142 people received unemployment benefits in June alone. By comparison, 138 striking workers have received benefits under the new law since January. Although the available public data do not yet allow a precise apples-to-apples comparison, strike-related claims clearly represent only a tiny share of overall unemployment benefit activity.
But two things can be true: Strike claims currently represent a tiny share of unemployment insurance benefit payouts, while the policy change itself remains significant.
As one bartender participating in the current Seattle hotel strike explained to The Washington State Standard, "It does allow people to go on strike for longer and be better off financially in order to get the contracts that they want signed.” She added, "And I want mine."
Lawmakers changed the purpose of the UI system, shifting part of the financial burden associated with collective bargaining from unions to an employer-funded public insurance program.
If unions believe workers need financial assistance while on strike, unions are free to provide it. Union dues exist in part to advance members' interests during collective bargaining. Employers should not be required to finance benefits for workers who voluntarily stop working during labor disputes. The UI fund was created to protect workers who lose work through no fault of their own.
Washington state's unemployment trust fund is already projected to fall below the statutory solvency level that can trigger automatic employer tax increases. State projections show benefit payments outpacing employer tax collections, reducing reserves and potentially activating a solvency surcharge paid by employers.
Strike benefits paid so far are not driving that projected tax increase. But it is concerning lawmakers expanded eligibility while projections show the fund is expected to fall below its statutory reserve target, potentially triggering additional employer taxes to rebuild the fund. Even if strike-related claims remain a small share of overall benefits, adding a new category of beneficiaries moves the system in the wrong direction and adds to the costs Washington employers must absorb — costs that can ultimately affect hiring, wages and opportunity for workers.
ESD is required to submit its first annual report on strike-related unemployment claims and their effect on the trust fund by the end of 2026. That report should provide the first official picture of how frequently the law is being used and what it means for employers in the state.
For now, the UI bucket has barely lost any additional water. Nevertheless, the Legislature drilled a new hole in its side that will continue to leak.
Making Washington a less attractive state to invest, hire and grow ultimately hurts employers and workers alike. Healthy businesses create jobs, raise wages and expand opportunity. Policies that steadily increase the cost of doing business hurt workers.
