Each year at the end of July or in early August,
the State of New Jersey
mails to all NJ employers
the updated Employer
Contribution Reports.
This report notifies
employers of their new unemployment rate
For the next 12 months
This begins a yearly ritual.
The owner sends a copy to their accountant,
the account reviews it
and life goes on.
Unemployment is a necessary evil.
Did you know….
Unemployment is the 2nd highest employer mandated tax paid by a business?
It is the only tax that you have the opportunity to control
what you contribute?
Unemployment is similar to having a checking account with
the State.
With this report….
The State tells you how much is in your account (reserve
balance)
The State also show you how many dollars were paid out in
claims
(how much was taken
out of your checking account)
The State assigns a rate based on the reserves you are
carrying
As a percentage of the taxable wages you have paid over the
past 3 to 5 years
This rate determines how much you will contribute into the
unemployment fund
over the next 12 months.
Seems pretty simple….
You hear all the latest political buzz
Everyone is talking about the deficit….
What are we to do about the debt ceiling?
Reduce our cost…….
Don’t raise taxes……
My guess is that nobody wants to talk about
The unemployment
deficit!!!!!
Each month we get updated numbers on the job market
Unemployment is over 9%
How are we to support the growing number in unemployment?
Did anybody tell you
That you will be getting a tax increase
To help cover the shortfall?
In the NJ Unemployment Rate Table
There are 6 columns the State uses to determine employers’
rates
In 2009/2010.
NJ worked off column
B to establish employer rates
Because of the rise in unemployment claims
The reserves became depleted
In order to build up the reserves in 2010/2011,
There was talk in NJ of working off column D.
The State chose to buffer the increase passed onto employers
and work off column C instead
That meant
last year every employer in NJ saw their rates go up
automatically
And pay more into the unemployment fund.
Did the shift from column B to C help?
The state still has a shortfall
This year,
There is talk of using column
E
for 2011/2012
However, most feel again
this would be too much of an increase
Instead,
Governor Christie’s signed a bill last Friday (7/1/11)
to work from Column D
I must have missed
that phone call!!!!!
Wasn’t that the Friday
before the holiday weekend?
I think I was stuck in
a traffic jam…
Each year,
the state continues to increase taxes by
shifting the table
used to assign rates to each employer.
We are all supposed to sit back and accept this as
The cost of doing business???
Besides jumping around on the table charts
How does an employer
even know their rates are correct?
Well, the State sent
me this form and it said this is our new rate
If you are an employer
with over 100 employees,
you should be asking that question.
The new rate does
not affect just 1 employee
But all employees
Therefore businesses with a larger employee base
Are affected more
If you currently employ over 100 employees,
Take the time to question your new rate
when you receive your notice.
Did you know that NJ has close to a 10% error rate in the processing of claims?
Nationally the error rate is over 11%
If the State is paying too much out in claims…..
Are they taking too
much money out of your checking account?
Really, close to a 10%
error rate
Who is holding the
state accountable?
For the last 10 years
Hutchinson Business Solutions along with our strategic
partner DCR
Has been asking this question for our clients.
We are your public
advocate.
There have been multiple instances that we have found an
error
In the rate assigned by the State
This is just not a NJ issue,
We see this in all the states we currently service
unemployment
How do you know if your current unemployment rate is
correct?
We would like to validate your
New unemployment rate,
for no cost.
We currently service many of the major corporations in the
Tri State area
For over 20 years
HBS and DCR have been at the forefront of unemployment
Representing the clients interest
Now more than ever, employers need to be proactive
Take the time to contest claims
Verify that the amount paid out for claims are correct
As the cost of unemployment continues to rise
You must be diligent
And take the necessary steps to manage your reserves
There may be some instances you cannot control
The state switches columns and everyone is affected
However,
There are multiple rates within each column
That is something we can
manage.
Our goal is to keep the dollars in your account
And achieve the best rate possible for our clients
Notice that the state will always contact you
If you owe taxes
Unfortunately,
They do not contact you,
If you are overpaying
taxes
The onus is on you
Let us help you
All you need to do is ask.
Let us validate your unemployment rate?
Many clients have been surprised at what we have found.
To learn more about how unemployment rates affect your
business, email
george@hbsadvantage.com
or call 856-857-1230
Visit us on the web www.hutchinsonbusinesssolutions.com