Jaw-Dropping Update on Massachusetts 2021 Unemployment Tax Rates

Each year, Massachusetts “tax paying” employers (not Reimbursable employers) pay an annual statutory UI Solvency Assessment. The solvency rate used in the calculation of each company’s UI experience for 2021 was announced today and is quickly reverberating through the employer community.  The Massachusetts Department of Unemployment Assistance has set the rate at 9.23%, which is an approximate 1600% increase from last year’s rates! The uniform solvency assessment is designed to cover the cost of benefit payments not directly chargeable to individual employers. However, as required by the non-charging provisions of the CARES Act, all regular Massachusetts COVID-19 related claims paid to eligible workers employed by contributory employers (for-profit and tax paying) are “relieved” to the state’s Solvency fund. This rate is computed annually in accordance with the statutory requirements of M.G.L Chapter 151A and is not within the discretion of the DUA to modify.

Employers in the Commonwealth recently received good news with the unemployment insurance rate freeze locking rates at “Schedule E” for 2 years. This clearly is news on the other end of the spectrum. Employers were not forewarned of the extreme Solvency Assessment escalation and the DUA has indicated the 9.23% rate is due to state law and cannot be overridden by their agency.

To distill this further, Covid-19 related claims were not directly “charged” to the individual experience rated accounts of Massachusetts employers in 2021.  Thus, the earned rate of employers was not subject to escalation as a direct result of Covid-19 claim payments.  The payments were re-directed and charged to the Solvency Fund financed by ALL employers through the Solvency Assessment surcharge, as a shared cost.  This policy prevented many employers from developing negative reserve balances, which would have likely made their 2021 UI base tax rate even higher.  However, it seems now the state aware of the Trust Fund status and solvency mechanism, relied upon the use of this mandated assessment to replenish the Solvency Fund.  In short, they simply shifted the direct rate escalation and liability (due to the forced shut down of our economy) to another line item of every employer’s rate notice. Even those who may have maintained full employment or experienced very little in claim activity.  Regrettably, the DUA and government officials did not alert the employer community, nor provide them sufficient opportunity to mobilize legislative interventions to off-set the impact of this measure.

As the Solvency Fund historically pays for dependency allowances and state funded extended benefits, which were substantially greater last year with the historical increase in unemployment insurance claims – it is not hard to see how the fund would be depleted. Unfortunately, the Solvency Assessment Rate is not discretionary, and the Secretary does not have the ability to set a rate that will not result in a balanced Solvency Fund.  It appears the only way this matter can be addressed is through Legislative action. UTCA has already initiated steps to pursue any and all forms of redress, including engaging legislators directly to pursue legislative remedies immediately. It is our understanding President Biden’s recent infusion of stimulus funds to state governments may be eligible to offset UI Trust Fund insolvency, and we support any calls to do so.

We are asking our clients and impacted employers to contact your legislators  to address this unprecedented and unsustainable cost increase to our very vulnerable employer community.  It is our humble opinion, employers still recovering from economic devastation of the pandemic, are in no position to withstand additional tax burdens and this will ultimately cause more job losses.

Please stand by for more updates and information related to UTCA’s activities to pursue legislative relief and galvanize a coalition of employers in this effort.  Timothy Phelan, General Counsel, Suzanne Murphy, CEO and Evan Murphy, Director of Business Development will be spear-heading efforts related to mobilizing clients in addressing the Solvency Assessment.

 

Atty. Timothy Phelan: (413) 686-9275

tphelan@utcainc.com

 

Suzanne Murphy: (413) 686-9271

s.murphy@utcainc.com

 

Evan Murphy: (413) 686-9877

emurphy@utcainc.com

Massachusetts Unemployment Excise Rate Pending Approval with Baker

 

Taxing Times

Massachusetts Bill H.90 “An Act financing a program for improvements to the Unemployment Insurance Trust Fund and providing relief to employers and workers in the Commonwealth” is currently pending Governor Charlie Baker’s approval. The bill has gained a lot of publicity as employer-friendly legislation that would prevent a potential increase (tax schedule E to G) of UI tax rates by 60% for some employers. With the massive UI payouts as a result of the pandemic, the commonwealth’s UI trust fund is likely to be insolvent by 2022. So in a move to prevent insolvency without dramatically increasing the UI tax schedule, Bill H.90 proposes an additional “excise rate” that will be assessed to employers along with their current UI contribution rate. The excise rate increases with the base UI contribution rate. You can view the proposed schedule below or view a separate attachment here.

Mass Bill H.90 Unemployment Excise Table

What does this mean to you?

It seems all but certain the proposed bill will be signed. Shortly thereafter, the Massachusetts DUA will have to work to get out all the 2021 Massachusetts Annual Tax Rate Notices  to employers which have been delayed. The notices should feature the new excise rate as well. Until those notices are issued, employers, their payroll providers or TPAs cannot file their quarterly employment and wage detail filings. Q1 2021 filings are typically due by 4/30/21. It is unclear if any extensions will result due to the delay in tax rate notices that are typically received between mid- December and mid- January.

As a tax-rated employer in Massachusetts that had to layoff or furlough employees due to the pandemic, there is a chance that the Covid-related charge relief efforts extended by the state kept you from significant tax increases. Raising the UI tax-rate schedule would have seriously reduced the positive effect of that relief. Depending on how severe or how long your reductions were (or still are) the smaller proposed “Excise Rate” might be palatable to you. As an employer who was fortunate enough not to be greatly affected by the pandemic, your outlook is likely less rosy as you figure out how to budget for this additional expense.

Whatever your viewpoint might be, the key to controlling unemployment cost is the same. It is now more important than EVER before to seize every opportunity you have to limit UI benefit charges to your account. With benefit charge payments higher than ever before and the new excise rate, the cost associated with missing or surrendering protest opportunities has become much higher.

D0 you feel like you don’t have the insight you need? Do you understand what your unemployment activity is telling you?  Does it feel like you’re paying claims you shouldn’t be?  Feel free to contact us here, we’re here to help in any way we can.

APRA and unemployment – what employers need to know!

ARPA Unemployment

 

The American Rescue Plan Act of 2021  Act has passed.  You’ve now sifted through all the articles about the third stimulus check and I’m sure your mind goes to the next most exciting question…..which unemployment provisions were affected?!

Many of the provisions enacted in the CARES Act were extended, as they were set to expire as of Sunday, 3/14/21. Here’s a brief refresher and explanation of what effect ARPA has now:

Greater Non-Profit Relief

From UTCA’s standpoint, this may be the single most significant and needed change to the previous federal relief efforts. Non-profit, reimbursable (or “self-funded”) employers incurred disproportionately higher unemployment costs that have had severe impacts to their operations. Due to the mechanisms of how state trust funds are funded, reimbursable employers were left out of the same 100% federal relief of Covid-19 related benefit charges. The CARES Act called for a 50% reimbursement of these charges. Some non-profits were fortunate enough to be in states that increased relief to 100%, but most states adopted the federal guidance at 50%. Under ARPA, that rate of relief increases to 75% from 3/15 through 9/6. While this is a positive step, UTCA continues to advocate for 100% relief and hopes local and state legislators persevere to include greater forgiveness in future legislation.

Pandemic Unemployment Assistance (PUA) 

This brand-new for 2020 program was a scramble to get instituted across all the state unemployment agencies. Being paid through federal funds, it offers a $600 per week payment to those traditionally ineligible to receive unemployment benefits (self-employed, gig workers, 1099s) who were unable to work due to Covid-19. The passing of ARPA will now extend the weeks of benefit payment eligibility to 9/6/2021.

Federal Pandemic Unemployment Assistance (FPUC)

FPUC is the often-discussed, sometimes controversial weekly “boost” provided by the federal government in addition to the state issued weekly benefit amount. This is relative to those who normally qualify for state unemployment and who are unable to work due to Covid-19. In most states this is a period of 26 weeks, though some vary as high as 30 weeks (Massachusetts) and some as low as 12 weeks (North Carolina).  This weekly boost was originally set at an additional $600 per week on TOP of state benefits. Many wondered if this rich benefit deterred some claimants from returning to work, as in some states the $600 was exponentially higher than the max benefit rate allowed. After the expiration on 7/31/20, the Lost Wages Assistance Act provided some relief in the fall of 2020, but most commonly at a reduced rate of $300 per week and most payments were issued until the week of 9/5/20. The CARES Act extension was signed on 12/27/20 that has bought us to the current term of FPUC, which issued payments from the first week of January but again at a reduced rate of $300/week. The original outline of ARPA called for an increase of $400 per week, but ultimately was voted to remain at $300 but to extend 9/6/2021.

Pandemic Emergency Unemployment Compensation (PEUC)

PEUC is paid to individuals who have exhausted all rights to state unemployment compensation. The amount to be paid is the amount of regular compensation plus $300 per week (consistent with amount of Pandemic Unemployment Compensation). This is similar to how traditional extended UC Benefits adds weeks to regular UC and continues with the additional $300. The extension of this program from the original CARES Act, it’s extensions and now in ARPA brings the total weeks of PEUC to 53. This is after the initial state UI weeks are exhausted.

Waiting Week Reimbursement

As provided initially in the CARES Act, the federal government was reimbursing states for waiving their waiting week periods. In an effort to allow claimants to file and be paid in a timely fashion, the federal government has agreed to pay this week if states re-enter into an agreement. States varied on their adoption and expiration of this waiver, with some ending it as early as April of 2020, while some states never had established waiting week policies. Similar to the previously mentioned extensions, ARPA will make this waiver available through 9/6/21.

Aiding Administration and Fighting Fraud

ARPA has allotted eight billion dollars to aid efforts in processing claims more efficiently. Unfortunately, the pandemic exposed many of the legacy processes and platforms that state UC agencies had relied on. Coupled with a trend of reducing their own workforces prior to Covid-19, massive claim backlogs, system crashes, employer and claimant complaints have resulted. The CARES Act had provided funds to enact changes, and it is understood that much of these funds were used on creating systems to properly administer the new PUA programs at the state level. It is unclear what these federal funds are contingent upon and if updating state systems that aren’t relative to carrying out “Federal activities relating to the administration of unemployment compensation program” would qualify.

With the historic claim levels came an even more shocking number of fraudulent unemployment claims. Every state has been impacted, causing a massive strain on state agencies, employers and their employees who are the direct victims of the UI fraud schemes. Measures to combat these attacks have been inconsistent, and in some instances created greater exposure of claimant data. Worst yet, means to add security measures such as additional ID verifications steps have greatly slowed claims processing times. Per ARPA, the federal government has dedicated two billion dollars to “detect and prevent fraud, promote equitable access, and ensure the timely payment of benefits with respect to unemployment compensation programs”. This is much needed, but states need to be very wary of the consultants and technology they align themselves with as they rush to find solutions.

State Forgiveness and “TBD”

Also, per ARPA the federal government has agreed to extend waivers of accrued interest on loans issued to states to pay unemployment compensation. This is in effect through 9/6/21.

What ARPA does not provide a clear, specific distribution to state UI trust funds, however, states are provided with large allocations of funds that may be used to address the costs of the Pandemic. It is yet to be determined how states will be able to utilize funds and what contingencies they may be subject to. This is critical as states are weighing serious tax rate increases which could impact the cost to employers for years to come. Some states have already enacted surcharges or temporary increases, while some are agreeing to freeze rates in the short term. It’s clear that UI trust funds across the country are in danger. UTCA is working to verify what it available to states and how the funds can be used.

Overwhelmed?

Is your head spinning yet? As we continue to “unpack” this enormous bill we will continue to track how the states will adopt these new programs and extensions. If you have questions as to how this might relate to your workplace or employees, don’t be afraid to contact us here .

 

 

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More Weeks, More Charges and the $600 Question

Covid-19 UnemploymentAs employers continue to navigate through the Covid-19 pandemic, the CARES Act has provided a tremendous amount of optimism. UTCA has been diligently providing insight to clients, non-clients, human resources and industry associations as they all pose their unique situations. Among the economic provisions being extended to businesses of all size and scope, the unemployment implications are still evolving.

Since the passing of the CARES Act., many are curious as to how and when the additional UI supplements are being issued. Pressure mounting from curious furloughed employees is inundating not only the state unemployment agencies, but HR departments as well. So we hope to shed some light on the current status so you can keep your employees and departments informed.

It is important to understand that while the federal government has passed several tiers of unemployment relief (read the summary here), the individual state agencies now must work directly administer these federal provisions. There is not a universally outlined implementation process from the U.S. Department of Labor that can easily integrate into the state systems. Coupled with the tremendous operational demand of new claim filings, state agencies are incredibly taxed. From a sheer technology perspective, instituting these new processes will be a challenge.

Of the many questions we’ve fielded, common echoes have been heard:

A furloughed employee filed with the state, but has only been approved for 26 weeks. They want to know why they aren’t getting the additional 13 weeks?

The additional 13 weeks of benefits as defined in PEUC (Section 2107) will be provided to the claimants after exhausting their state unemployment allowable weeks (typically 26 weeks), totaling 39 weeks of available benefits. In most instances, it is likely the state agencies will not show the federally extended benefits expressed in their initial eligibility determinations.

In more traditional times, extended benefits (the great recession, natural disasters) state agencies have paid the initial 26 weeks (more or less depending on the state) with the extended week’s “tab” being reimbursed by the federal government. We are hopeful that most claimants affected by Covid-19 will have returned to work before having to utilize federally extended benefits.

 They were only approved for their weekly benefit amount of $XXX.XX, but they aren’t getting the additional $600 per week as promised, why were they denied?

Currently, every state unemployment agency has agreed to the provisions in the CARES Act. Per the provisions, the additional $600 per week can be issued as early as 4/5/2020 until 7/31/2020. Although all states have made agreements, some may not have implemented the mechanisms necessary to process the additional weekly payments. Some agencies such as the New York Department of Labor are slated to pay the additional $600/week now.

As many states are still working through their individual process for distributing these funds, it’s likely many states will stall and retroactive payments may be issued. It is important to note that these additional $600 allotments may not be shown in a claimant’s initial monetary determination of their standard state weekly benefit amount. So this expectation may be helpful when advising your concerned furloughed employees.

We’re a non-profit, reimbursable employer and the CARES Act only seems to allow us relief of half of our Covid-19 related charges, is this true?

It is true that the CARES Act currently only identifies “partial” benefit charge reimbursement related to Covid-19 as “generally 50 percent”. However, individual states may offer additional terms of relief in the future. Additionally, the guidance allows states “maximum flexibility” in granting extensions of benefit charge payments due by non-profits. For example, pending bill no. 2618 in Massachusetts proposes a 120-day extension of scheduled payment without penalty or interest. UTCA has been continuously engaged with several industry associations that are strongly advocating for equitable relief for all employers.

Interestingly, per Section 2103 of the CARES Act states “…partial reimbursements apply to all payments made during this time period, even if the unemployed individual is not unemployed as a result of Covid-19.. UTCA is actively trying to confirm this tenant, and how it will be interpreted by individual states.

In It Together

We understand and empathize with all of you weighing the future of your workforce with business needs in mind, all while trying to dissect so much new information. While all the answers aren’t yet cemented as it relates to UI, we hope this piece helps you communicate expectations internally and to your employees with bit more confidence. We will continue to update you as specific state regulations pass.

If you have a specific question you would like to pose about your workforce, we’re happy to help any way we can. Please feel free to can contact us here.

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UI Phone Hearings and Coronavirus – Temporary or New Norm?

Unemployment Covid-19

We’ve seen state unemployment agencies transition to phone hearings as opposed to “live” or in-person hearings, for some time now. Amidst the COVID-19 scare and social distancing guidelines, states such as Massachusetts have limited the format to telephone-only. While moves like these may be a temporary response, telephonic unemployment hearings might become the new norm for states that previously allowed for “live” format. It’s never been more crucial to brush up on telephonic hearing preparedness than it is right now.

One differentiation of telephonic hearings is the documentation and presentation of evidence. As the witness is not there in person, documentary evidence cannot be provided directly to the Judge (Referee, Examiner, etc.) as the hearing is being conducted. It is imperative you send new documentation not previously submitted at the Determination level, in advance to both the state agency and the claimant. Judges can exclude written, relevant evidence if that individual state’s procedures are not followed and/or the claimant has not been provided access to such evidence.

A key disadvantage to the telephone hearing is that the Judge does not have the ability to observe witnesses. Lacking are cues from the claimant’s face, body language, movements, demeanor etc. These factors are substantial when it comes to determining the credibility of witnesses. Thus, the Judge will be making their determination regarding witness credibility in less than ideal circumstances. In addition, it is well known through various studies, people are more likely to lie when they are not confronted face-to-face.

Important Dos & Don’ts for Phone Hearings:

  • Be sure to follow the registration or notification process as outlined by the state agency. Some states may provide a number to call to connect, while others require advanced registration requirements to provide numbers so the judge can contact you. Failing to follow these steps may leave you in default or delay the process and get you off on the wrong foot!

 

  • Presentation skills must be adjusted in this setting. A well-modulated voice, which conveys confidence, quick, direct, firm answers to questions as well as the ability to reference a document efficiently without scrambling through a file, can do much to create an impression of credibility.

 

  • Witnesses must provide crisp, clear and professional testimony. UTCA assists clients to be prepared and know the case facts. As witnesses cannot be observed thoughtfully considering a response—too long a pause can appear slow and uncertain. An inadequate response may be looked upon as unfavorable or that a witness is ad-libbing.

 

  • Remember to speak audibly! And, if anyone cannot hear another party during the hearing, quickly let this be known. This is a procedural option and not a violation of protocol. Do not wait until midway through the proceeding to make the Judge aware of this detriment.

 

  • Multiple witnesses: It is always best to have them in the same room, on the same speakerphone if possible. Given the current state of quarantining and social distancing this might not be possible. Multiple lines or locations often irritate Judges and increase the chance of technical failures, but under current circumstances this may be the safest option for most employers.

 

  • Always have the case file paperwork available, directly in front of you. Please review it prior to the hearing one last time.

 

  • Judges often become very annoyed if they hear a phone ring, a ping of an arriving text or some other avoidable sound. In addition, all other devices, computers, faxes etc., should be turned off. All environmental noises should also be eliminated.

 

  • Stay on the Judge’s good side! Remember, they are the decision maker and assess credibility. Be at your phone at the start of the hearing, waiting for the call to come in. Judges get audibly annoyed being put on hold for witnesses to be located. This is similar to being “late” for a live hearing. Use direct dial numbers if available to avoid transfers and disconnects.

 

  • DO NOT talk while somebody else is testifying. While this is also true for a “live” hearing, it is more important for a telephone hearing as the Judge may not be able to distinguish who is or isn’t speaking.

 

  • DO NOT cross talk with other employer witnesses. If you are heard whispering to another person during the hearing, it gives the appearance you are looking for assistance in answering a question, and may be providing less than truthful testimony.

 

Nervous about your next hearing or deliberating an appeal?  Contact us here!

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Devil is in the Detail – Keys to Winning Attendance-based UI Claims

Winning an unemployment case is a difficult task as it is, even more so when it involves absenteeism or tardiness. Unfortunately, most absentee cases are determined by the final incident. It’s no secret we can’t be present for every final incident to ensure not only the proper steps are taken to follow company policy, but proper documentation is occurring as well. Ultimately, this means front-line managers and supervisors must recognize the importance of this information. Most employers have well-established and comprehensive written attendance policies, and require their employees to sign-off that they have received the handbook or policy.

 

Despite their best efforts, sometimes even thorough employers fail to make specific distinctions in their policies such as:

When is a doctor’s note required?
• What is considered excessive absenteeism?
• Who are they to communicate their tardiness  or absence to?
• What is an acceptable means of communicating tardiness or an absence (call, text, email)?
• When is an absence considered excused or unexcused?

Problems for employers with absenteeism (and other time related policy issues) generally originate with the manner in which the employer documents day-to-day violations. Employers may have detailed policies spelling out the aforementioned attendance issues – it is the documentation process that often determines a win or loss in the unemployment arena. Management must remember: pure numbers of absences or tardiness may violate your policy and justify a legal discharge but do not guarantee a winning unemployment case, or even a strong unemployment case.

To make your case much stronger, it means more than just logging the dates of absenteeism, tardiness and corrective action. You must document everything for each and every absence or instance of tardiness. Specifically:

• What exact time did they communicate their absence /tardiness?
• Who called in, the employee themselves or a family member, friend, etc.?
• With whom did they speak or when was the message received?
• Did they leave a voice message?
• Did you save the message, email or text?
• What was the exact reason or excuse given?
• Did they provide a doctor’s note?
• What did the manager/supervisor say in response to the call?
• What was the employee’s start and finish time?
• Did the manager/supervisor make any requests of the employee?

Again, the importance is always placed on a final incident. When pressed for a claimant’s excuse for the final incident, a supervisor may say: “It was always something about their car”. Looking at the claimant’s statement to the unemployment office they may say their car wouldn’t start. The claimant will be found eligible and the employer will lose any protest because we can’t dispute their statement. In a different scenario, if the supervisor documents the final excuse on paper as “my car broke down on the way to work” and the claimant tells the unemployment office “my car wouldn’t start”, you have an inconsistent statement casting doubt on the credibility of the claimant which can turn a very weak case into a likely winner.
Employers have won cases based on the variety of dramatic excuses given by a claimant over time for absenteeism (cat had emergency surgery; fire-truck blocked me in on my street; power failure in area; pipe burst in my apartment; a baseball shattered my windshield). Some excuses can be so outlandish and inconsistent that it paves the way for a much easier disqualification. Whether it’s an outrageous story or a seemingly slight nuance in a statement, solid documentation will always be extremely helpful.

More is Less, and That’s Good

What’s the lesson in all this? Contrary to the old “Less is More” adage, employers that record more detail in the documentation process, will likely result in paying less out in UI benefits for absence and time related separations. See what we did there?

Are attendance claims a sore spot? Contact us here !

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Rewrite, Refresh or Reissue? Are your unenforced policies putting you at risk?

As we enter the 2020s, many of us have lofty goals for ourselves and our organizations. Whether it’s launching company-wide initiatives, “tweaking procedures” or revisiting marks we may have missed the previous year. As the year takes off, our laundry list can quickly be reprioritized, shuffled and some of those forgotten, nagging items can resurface as major issues. Often times this takes the form of policies or procedures that may have fallen by the way side in recent years. Perhaps it was due to a departmental restructuring, management shift or new business process. Maybe it’s continually pushed by challenges coordinating training with staff. If there are policies that exist in your workforce that haven’t been enforced consistently, it may leave you open to exposure in unemployment and other areas of risk. With the new year in full swing, this might be the best time to focus in on those back-burner policies!

In each state there are similar requirements under the law, i.e., your rules and policies must be known, followed and consistently enforced with all employees regardless of their overall job performance. Employers are not to indiscriminately pick and choose against whom they enforce policies (certainly not without repercussions). When this does happen, risks far greater than unemployment can be generated. A supervisor simply cannot play favorites and selectively apply policies based on their opinion of the worthiness of the employee involved.

As many human resource professionals know, these scenarios frequently occur without their knowledge, when supervisors don’t report events to their manager or human resources. These supervisors may view their employees as their management “territory” and prefer not to be held accountable to organizational standards. Unless reported, the HR department would not know what is going on in that particular department. This can come back to haunt the employer.  It does not matter what type of performer the employee is in the workplace, the policies must be enforced equally.

These situations can arise intentionally or inadvertently, i.e., when a new supervisor is simply inexperienced and does not apply policies correctly, or at all. This can go on for months or years, when more senior management does not detect the oversights. In other instances, refusing to formally address policy violations or misconduct may even be a corporate culture issue and method for the employer.

This also happens more frequently with multi-location employers, where oversight may be more difficult and decentralized. As such, these issues in the workplace commonly “snowball” where management believes they are trapped by past practices and unable to address recurring issues, or emerging issues, due to lack of precedence and a history of permissive or inconsistent practices. Unfortunately, this situation can be self-perpetuating costing the employer far more in unemployment costs and generating risks related to disparate treatment or wrongful discharge litigation.

So, these questions arise:

  • How does an employer correct their previous mistakes or prior inaction?
  • Can they?
  • Should they?
  • Are they stuck in this perpetual cycle?

Most employers recognize their past indiscretions and want to improve their management practices. In these situations, the best way to proceed is really to start from square one:

  • Designate a “reset” that begins with the re-issue (or perhaps first issue) of a well written, and updated employee handbook, code of conduct, rules, etc.
  • Poorly written policies can be deleted and replaced with strong, legally appropriate and clear standards.
  • Then, all employees must acknowledge their receipt of the new handbook, whether it is distributed via hard copy or over an internal intranet.

What does this mean for the employer?

The burden is on the employer to establish employees were made aware of the organization’s expectations. The re-issue should be accompanied by some type of memorandum stating this is the new, updated handbook, superseding all prior policies and from this point forward our organization will be strictly adhering to the specifics outlined in the handbook.

The handbook, or rules of conduct release date would be the formal reset date for the organization. Employers are not to announce this “reset” status, new period or use such terminology. All that is required is the new or updated rules or policies and the statement as noted above.

Employers want to make sure their language does not admit or acknowledge you have not uniformly enforced your policies in the past. Most importantly, the emphasis must focus on the future, the employer is now required to comply with their own written guidelines and policies, or they will revert back to the same position of disparate and careless application of rules and standards.

In terms of unemployment, management witnesses can now truthfully testify at a future UI hearing: “As of the policy issue date, this rule has been strictly enforced and uniformly adhered to.” This places the employer in a strong position to contest invalid claims and protect them from risks far beyond the unemployment arena.

Is that dormant policy giving you heartburn or has it resulted in UI charges? Let’s cross another thing off your to-do-list!

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Massachusetts Hikes Unemployent Tax Rates Again!

Despite a relatively healthy UI trust fund, and national trends lowering UI tax rates, the Massachusetts Department of Unemployment Assistance has confirmed that Tax Rate Schedule “E” will officially be enacted as of January 1, 2019. This schedule will effectively raise employer contribution rates, with the minimum rate being .94% (previously .83%) and the maximum rate at 14.37% (previously 12.65%).

Fortunately, the state Solvency Assessment will be set at 0.96%, which has decreased by from 1.01%. The taxable wage base for 2019 will remain unchanged at $15,000 per employee.

This schedule will be applied to all Massachusetts 2019 tax rate notices, which employers will begin receiving in the next few weeks. If you are a UTCA client, or just an employer with questions about your experience and rate calculation we would be happy to review with you. Please contact us here.

 

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UTCA Hosts Their 18th Annual Client Update!

Unemployment Tax Control Associates (UTCA) recently hosted its 18th Annual Client Update at the Sheraton Monarch Place Hotel and Conference Center in Springfield, MA.

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Extended Benefits = Extended Recession?!!

In a recent congressional report by the Committee of Ways and Means, the effect of the Emergency Unemployment Compensation (EUC) program is examined, and the data is staggering. Historical periods of extended benefits and record-breaking costs added to the national debt confirm what many employers (UTCA included) have believed as the US has struggled to create new jobs.

EUC Duration graph

This is a highly recommended read:

http://waysandmeans.house.gov/uploadedfiles/euc_labor_day_report_082814.pdf

 

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