Here’s an announcement that came from left field (baseball! pitchers and catchers report to spring training in a few days…sorry, that’s not the announcement). On January 14, 2021, New York State Department of Labor (“DOL”) Commissioner Roberta Reardon signed an Order that temporarily cancels unemployment insurance (“UI”) charges for all employers.
According to the Order, retroactive to March 9, 2020, and going forward for an indefinite period, the State will use the general unemployment insurance account to cover all unemployment benefit payments. Also, regardless of whether the employer pays unemployment insurance taxes or directly reimburses the State for UI benefits paid to claimants, the Order cancels all charges made against employers’ accounts from March 9, 2020. (Did somebody in Albany get a printing press from Santa? Never mind, I don’t want to know.)
Under the federal Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”), self-insured nonprofits, Native American tribes, and government agencies were to be reimbursed 50 percent of their unemployment charges from March 13, 2020, through December 31, 2020. Based on the Commissioner’s January 14, 2021 Order, the State will reimburse these employers the remaining 50 percent charged to their accounts during that period. Further, charges incurred beginning January 1, 2021, will be charged to the State’s general account¾not the employer¾indefinitely.
The NYS DOL has not indicated how it will reimburse eligible employers for UI charges incurred on or after March 9, 2020. However, the most likely scenario is a credit against future unemployment insurance benefit charges.
This Order also means the continuing flood of unemployment claims since March 9, 2020, will have no negative impact on private employers’ UI experience ratings. What we don’t know is whether these employers will be required to continue paying unemployment insurance taxes.
Employers should continue reviewing DOL charge statements, bills, and other documents on a timely basis and continue to protest claims as appropriate. Also, there has been an exponential increase in fraudulent UI claims. (Yep, I recently got a notice that I filed for UI benefits!) Employers who receive UI benefit notices for potentially fraudulent benefit claims should notify the NYS DOL at 888-598-2077, at https://webapps.labor.ny.gov/dews/ui/fraud/report-fraud.shtm, or by mail at NYS Department of Labor, Office of Special Investigations, Bldg. 12-Room 200, W.A. Harriman Campus, Albany, NY 12240.
Posted by Frank Cania, president of HR Compliance Experts LLC.
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Disclaimer: This content is for informational purposes only, does not constitute a legal opinion, and is not legal advice. The facts of each situation should be considered and analyzed individually. Therefore, you should always consult with competent employment counsel regarding any issues discussed here.
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