The Massachusetts Department of Unemployment Assistance (DUA) has issued a notice regarding employers budgeting properly for their quarterly Unemployment Insurance (UI) contributions.
The annual UI rate scheduled is based on the balance of the Unemployment Trust Fund. Due to the high volume of claims caused by the COVID-19 pandemic, the Unemployment Trust Fund currently has a discrepancy balance, therefore triggering a high rate — schedule “G” — for the 2021 calendar year.
With no guidance from the legislation, UI employer contributions in 2021 will be increased to the highest allowable amount, causing the average employer contribution to grow by 60%, from $539 to $866. Foreseeing this increase, Governor Baker has filed legislation impacting the 2021 UI rate schedule. House bill 55, An Act financing a program for improvements to the Unemployment Insurance Trust Fund and relief to employers in the Commonwealth, will freeze the rate schedule for 2021 and 2022 at the current schedule “E,” slowing the contribution growth rate.
We will continue to monitor this legislation and are hopeful that the legislature will act quickly to approve the rate schedule freeze. However, if the legislature does not approve the rate freeze, as the April 30, 2021, Q1 contributions due date approaches, DUA will be prepared to issue rate notices for schedule “G” by the end of March 2021. Until these 2021 rate notices are issued, employers and third-party administrators (TPAs) will be unable to file for their Q1 2021 Employment and Wage Detail, which includes zero wage filings.
Employers Next Steps
- If you have any questions regarding this e-Alert, please email us.
The People Simplifying HR
For almost twenty years, HR Knowledge has made it our mission to demystify the complex and daunting process of HR management. We do more than just provide the level of service and technology you’d expect from an industry leader. We combine an unparalleled passion for service with our decades of HR, payroll, and benefits experience to provide our clients with personalized and actionable advice that is second–to–none. From managed payroll to employee benefits to HR support, we can help your organization thrive, grow, and reduce operating costs—no matter what industry you serve. Whether you’re interested in our Full-Service solution or just need your employee handbook written, HR Knowledge can help you minimize risk while staying on top of compliance regulations. The bottom line? We’re not just another cloud-based technology company that also does HR, #WeAreHR. Get the scoop on how we can help you simplify HR.
This content is provided with the understanding that HR Knowledge is not rendering legal advice. While every effort is made to provide current information, the law changes regularly and laws may vary depending on the state or municipality. The material is made available for informational purposes only and is not a substitute for legal advice or your professional judgment. You should review applicable laws in your jurisdiction and consult experienced counsel for legal advice. If you have any questions regarding this content, please contact HR Knowledge at 508.339.1300 or email us.