Unemployment Benefits: More States Eye Cuts

Written by Arthur Delaney for Huffington Post

Add Pennsylvania and Wisconsin to the list of states considering cuts to unemployment insurance.

The Pennsylvania General Assembly needs to pass a law in order for the state to remain eligible for the federal Extended Benefits program for the rest of the year, which provides the final 20 weeks of checks in Pennsylvania for people who use up 73 weeks of combined state and federal aid. Within the past two months, lawmakers in Michigan, Missouri and Florida permanently slashed state unemployment aid in bills that preserve temporary federal aid.

Two Republican-sponsored measures moving through the GOP-controlled Pennsylvania statehouse would achieve similar results. And in Wisconsin, a proposal by Republican Gov. Scott Walker would restore the Extended Benefits program after local lawmakers let it lapse with virtually no public debate last month. But Walker’s bill would also permanently install a one-week waiting period for new claimants before any jobless claims are paid, relieving Wisconsin businesses of a $45.2 million tax burden. (Wisconsin is one of 13 states that had no waiting week in 2010.)

“Without knowing exactly how the state arrived at the $45.2 million figure, it is safe to say that a roughly equivalent amount will come out of workers’ pockets,” said Mike Evangelist of the National Employment Law Project, a worker advocacy group.

States pay for the first 26 weeks of unemployment benefits, and during recessions the federal government pays for extra weeks. While current federal unemployment benefits will only be around until January barring an unlikely congressional reauthorization, changes to state law will be permanent.

The bill in the Pennsylvania House of Representatives would save the state $632 million chiefly by cutting the average weekly payment from $324 to $277, according to Sharon Dietrich, an attorney with Community Legal Services, a nonprofit group that advocates for poor people in Pennsylvania. The bill in the Pennsylvania Senate — which Dietrich said she considers “way more innocuous” — would, like its counterpart in the House, tighten work-search requirements, but would only result in a net spending decrease of $50 million, Dietrich said. Each bill will reach the floor of its respective chamber early next week.

“On June 11, approximately 45,000 unemployed Pennsylvanians who currently qualify for federal extended benefits will be dropped from the unemployment rolls unless we slightly modify the state law,” State Sen. John Gordner (R) said in a statement.  “It costs the state no money to qualify for these fully funded federal benefits through the end of the year, and results in an estimated $150 million in economic benefits.”

South Carolina is also considering cutting state aid, and lawmakers in North Carolina and Tennessee are still debating measures to revive the EB program after they let it die last month.

And in the U.S. Congress, Republican lawmakers are pushing a bill that would give states leeway to trim federal aid to the unemployed to use the money instead to repay federal unemployment government loans

States Ignored Years Of Warnings On Unemployment Insurance

KEVIN FREKING   02/19/11 08:42 PM  

As reported in Huffington Post

WASHINGTON — State officials had plenty of warning. Over the past three decades, two national commissions and a series of government audits sounded alarms about the dwindling amount of money states were setting aside to pay unemployment insurance to laid-off workers.

“Trust Fund Reserves Inadequate,” federal auditors said in a 1988 report.

It’s clear now the warnings were pretty much ignored. Instead, states kept whittling away at the trust funds, mostly by cutting unemployment insurance taxes at the behest of the business community. The low balances hastened insolvency when the recession hit, leading about 30 states to borrow $41.5 billion from the federal government to pay unemployment benefits to their growing population of jobless.

The ramifications will be felt for years.

In the short term, states must find the money to pay interest on the loans. Generally, that involves a special tax on businesses until the loan is repaid. Some states could tap general revenues, making it harder to pay for schools, roads and other state services.

In the long term, state will have to replenish their unemployment insurance programs. That typically leads to higher payroll taxes, leaving companies with less money to invest.

Past recessions have resulted in insolvencies. Seven states borrowed money in the early 1990s; eight did so as a result of the 2001 recession.

But the numbers are much worse this time because of the recession was more severe and the funds already were low when it hit, said Wayne Vroman, an analyst at the Urban Institute, a liberal-leaning think tank based in Washington.

The Obama administration this month proposed giving states a waiver on the interest payments due this fall. Down the road, the administration would raise the amount of wages on which companies pay federal unemployment taxes. Many states probably would follow suit as a way of boosting depleted trust funds.

Businesses pay a federal and state payroll tax. The federal tax primarily covers administrative costs; the state tax pays for the regular benefits a worker gets when laid off. The Treasury Department manages the trust funds that hold each state’s taxes.

Each state decides whether its unemployment fund has enough money. In 2000, total reserves for states and territories came to about $54 billion. That dropped to $38 billion by the end of 2007, just as the recession began.

Over the next two years, reserves plummeted to $11.1 billion, lower than at any time in the program’s history when adjusted for inflation, the Government Accountability Office said in its most recent report on the issue. Yet benefits have stayed relatively flat, or declined when compared with average weekly wages.

“If you look at it from the employers’ standpoint, they’re not going to want reserves to build up excessively high because then there’s an increasing risk that advocates for benefit expansion would point to the high reserves and say, ‘We can afford to increase benefits,'” said Rich Hobbie, executive director of the National Association of State Workforce Agencies.

A review of state unemployment insurance programs shows how states weakened their trust funds over the past two decades.

In Georgia, lawmakers gave employers a four-year tax holiday from 1999-2003. Employers saved more than $1 billion, but trust fund reserves fell about 40 percent, to $700 million. The state gradually has raised its unemployment insurance taxes since then, but not nearly enough to restore the trust fund to previous levels. The state began borrowing in December 2009. Now it owes Washington about $588 million.

Republican Mark Butler, Georgia’s labor commissioner, said his state had one of the lowest unemployment insurance tax rates in the nation when the tax holiday was enacted.

“The decision to do this was not really based upon any practical reasoIt was based on a political decision, which I think, by all accounts now, we can look back on and say it was the wrong decision,” Butler said. “Now we find ourselves in a situation where we’ve had to borrow money and that puts everyone in a tight situation.”

In New Jersey, lawmakers used a combination approach to deplete the trust fund. The Legislature expanded benefits and cut taxes, as well as spending $4.7 billion of trust fund revenue to reimburse hospitals for indigent health care. The money was diverted over a period of about 15 years and helps explain why the state’s trust fund dropped from $3.1 billion in 2000 to $35 million by the end of 2010. The state has had to borrow $1.75 billion from the federal government to keep the program afloat.

“It was a real abdication of responsibility and a complete misunderstanding of how you finance an unemployment insurance fund – to make sure you have sufficient money in bad economic times,” said Phillip Kirschner, president of the New Jersey Business and Industry Association. “In good economic times you build up your bank account, but in New Jersey, they said, ‘Well, we have all this money, let’s spend it.'”

California took its own road to trust fund insolvency. Lawmakers kept payroll tax rates the same, but gradually doubled the maximum weekly benefit paid to laid-off workers to $450. The average benefit now is about $300 and is paid for about 20 weeks.

Loree Levy, spokeswoman for the California Employment Development Department, said lawmakers were warned of the consequences.

“We testified at legislative hearings that the fund would eventually go broke and would become permanently insolvent if legislation wasn’t passed to increase revenue,” Levy said.

California has borrowed $9.8 billion to keep unemployment insurance payments flowing. It owes the federal government an interest payment of $362 million by the end of September.

In Michigan, unemployment insurance tax rates declined from 1994 through 2001. The trust fund prospered during those years because of the healthy economy and low unemployment rate. Then the recession arrived and reserves plunged. In response, Michigan lawmakers passed legislation that lowered the amount of wages subject to unemployment taxes from $9,500 to $9,000. They increased the maximum weekly benefit from $300 to $362. The trust fund dropped from $1.2 billion to $112 million over the next four years. In September 2006, Michigan was the first state to begin borrowing from the federal government.

Other states held their trust funds purposely low as part of an approach called “pay-as-you-go.” Texas is a nationally recognized leader of this effort. Its philosophy is that, in the long run, it’s better for the economy to keep the maximum level of dollars in the hands of businesses rather than government. Texas had to borrow $1.3 billion in 2009. State officials have no regrets about their policy.

“By keeping the minimum in the (trust fund), Texas is able to maximize funds circulating in the Texas economy, allowing for the creation of jobs and stimulation of economic growth,” said Lisa Givens, spokeswoman for the Texas Workforce Commission.

The pay-as-you-go approach goes against the findings of a presidential commission that looked into the issue of dwindling trust funds in the mid-1990s.

“It would be in the interest of the nation to begin to restore the forward-funding nature of the unemployment insurance system, resulting in a building up of reserves during good economic times and a drawing down of reserves during recessions,” said the Advisory Council on Unemployment Compensation, which President Bill Clinton appointed.

Hobbie, from the association representing state labor agencies, said there’s no way to tell which approach is better over the long haul. He acknowledged that keeping reserves at the minimum in good times goes against one of the original aims of the program – to act as an economic stabilizer in bad times. That’s because businesses are asked to pay more in taxes, which leaves them less money to invest in their company.

A survey from Hobbies’ organization found that 35 states raised their state unemployment taxes last year.

Hobbie said he suspects that some states allowed reserves to dwindle out of complacency.

“I think we just got overconfident and thought we wouldn’t experience the bad recessions we had in, say the mid ’70s, and then this big surprise hit,” he said.

The Little Things

I was driving down the Garden State Parkway a couple of weeks ago and I was enjoying the full color spectrum of the fall trees. Some of the trees were beginning to lose leaves but looking on a mile or so ahead, it presented a beautiful view. 

I really love this time of year and how God uses the landscape to paint a perfect picture. 

Turning onto the Atlantic City Expressway, I started to notice that the picture was fading. No longer could I see the brilliant colors ahead, for the trees were almost bare once I got to mile marker 13.5. 

I was a little surprised, for you would think that the fall splendor is universal in the area? 

I didn’t realize that there exist little pockets; that have their own hours to shine. 

We all must exist on our own timeline! 

What made mile marker 13.5 the breakpoint? 

That started me thinking. All the little things we just take for granted on a daily basis. 

What made me stop and take notice of the difference? 

Why? 

Because that is part of my character and that is what we do here at HBS. 

We look at the little things, the cost that most companies just take for granted. 

Most of our items are just budgeted for. 

What did we pay last year and how much do you think it may go up? 

     Electric…. Natural Gas…. Voice… Data…. Unemployment Taxes…. Sales Tax 

Need I say more? 

We call these costs the unsung heroes! 

These are daily cost of doing business that most companies tend to ignore. 

We find many people are resistant to change but: 

The only thing constant in life is change!  

Each client is unique. 

Each opportunity opens the door to defining what the client is currently doing; 

Exploring various options and 

Providing solutions, designed to increase efficiency and savings. 

We understand that the current economic climate has been difficult for many businesses. 

HBS provides: 

Smart Solutions for Smart Business. 

Many times, it is the little things that provide the best opportunities. 

Would you like to know more? Email george@hbsadvantage.com or call 856-857-1230.

Visit us on the web www.hutchinsonbusinesssolutions.com

NJ Announces New Unemployment Rates

The state of New Jersey will soon be issuing the 2010/2011 unemployment tax rate notices.

 For those clients with over 100 employees, it is important to be aware how these new rates will affect your company.

 Once you receive your notice, please fax a copy along with a copy of last years notice to HBS @ 856-857-1233.

 Upon receipt, we will review the information with you and validate the numbers are correct or discuss what options may be available with you.

 There are times that a voluntary contribution may appear to be beneficial. This contribution will actually lower your rate.  We will advise you as to the amount of contribution, as well as the anticipated tax savings.

 Please take note, due to the high level of Unemployment Benefits paid out, the State of New Jersey requires a higher tax rating table to be imposed this year. As a result, Tax Schedule “C” is in effect this year, compared to Tax Schedule “B” which was in effect last year. Thus, most employers will receive a higher tax rating assignment this year than they did last year.

To illustrate how this works, if you compare the two tables (see below portion of the tables) you will see that a Reserve Ratio between 0.00% – 00.99% last year produced a 3.0% tax rate; however, this year the same ratio produces a 3.6% tax rate, creating a 0.6% tax increase

 Tax Rate Tax Rate    Reserve Ratio       2009/2010        2009/2010 Difference

2.00% – 2.99%                    2.8%                          3.3%                            +0.6%

1.00% – 1.99%                     2.9%                          3.4%                           +0.6%

0.00% – 0.99%                   3.0%                          3.6%                          +0.6%

Unemployment Costs are rising and Unemployment Cost Control is more important than ever. The high level of unemployment, along with anticipated legislation, is expected to continue the trend of increasing unemployment compensation costs.

 Employers should continue to be pro-active in contesting unwarranted unemployment claims.

 While this has always been our position, it is important to continue to be diligent in this area.

 If you previously chose not to actively contest unemployment claims you may want to reconsider this approach in the future, based on the tax information outlined above.

 The successful participation in all unemployment hearings, with the assistance of our strategic partner DCR as required, will continue to help maintain the lowest possible tax rate. The impact of a few weeks in Unemployment benefits paid out may now have an even a higher impact to your bottom line.

Take the time now to proactively maximize your position on minimizing the cost of future tax increases.

If you should have any questions concerning the new tax rate, or would like specific recommendations for your organization, please do not hesitate to call.

 Now more than ever, controlling the cost of unemployment is important for your company.

For more information email george@hbsadvantage.com or call 856-857-1230

Visit us on the web www.hutchinsonbusinesssolutions.com

Your Unemployment Taxes Are Going Up

New Jersey is set to release their new unemployment rates in August 2010.

There is one problem!

The state’s unemployment fund is vastly depleted and because of this they will be moving to a new column to calculate the rates. The current rates are being calculated from column B. The state currently has 6 columns to choose from in assigning rates. This year there is talk of moving to the furthest column, which will provide the maximum rates.

 Example:

If your current Employer Reserve ratio is between 4.00% and 5.00% you are currently paying 2.6% of your taxable wages into the unemployment fund over the last year. If your taxable wage base is $1,000,000 that would equate to $26,000. This ratio was chosen from column B.

Under the new proposed rating system if your Employer Reserve ratio is exactly the same, between 4.00% and 5.00%, your new rate could be chosen from column E+10. That would put your rate at 4.10%.

This is a 57% increase.

You will now be paying $41,000 into the unemployment reserve fund over the next year.

 Again, the actual table the state will be using has not been finalized but with the depletion of the current reserve balances, this option is being considered. Should they choose not to use the maximum rate, the next options could be:

Column C…3.1% ($31,000)

Column D..  3.4% ($34,000) 

Column E… 3.7% ($37,000).

Either way, your taxes are going up.

This would be a good time to validate if your current rate is correct!

Unemployment is the 2nd highest government mandated employer tax, yet no one seems to question it.

It is the only tax that you have the opportunity to control what amount you pay each year.

Is your rate correct?

The state of New Jersey has a 10% error rate in the payment of claims. This means that your rate may be incorrect.

The US Department of Labor states that if your company has been involved in a merger or acquisition in the last 3 years, there is a 50% chance that you have been assigned an incorrect rate.

We offer a free analysis of your current rate and we can also provide projections as to what your rate may be in the up coming tax year.

For more information email george@hbsadvantage or call 856-857-1230.

NJ Unemployment Rates will be going up!

What’s your Rate?

We recently were notified that the State of New Jersey would be mailing out updated unemployment rates to all employers in New Jersey starting August 15^th. 

Yawn!!!!

Why the announcement? No one looks at the notice.

So our rate may go up .1% from 2.3% to 2.4%, that’s the cost of doing business!

Wrong!!!!

 

How do you know your rate is calculated properly?

Unemployment is the 2^nd highest employer mandated tax. It is like having a checking account with the state. They provide the rate, which tells you how much you must deposit into the account during the next year. They also provide a notice telling you how much they have taken out of your account.

Not Bad! Are you sure no one questions this?

 

Why publicize that employers may be overpaying payroll taxes? They do it willingly, without asking questions.

If your company employs over 150 employees, you should be looking at this rate. If there is a mistake it is not just with one employee, it is on your whole payroll.

Why will my rate be going up?

 Since the economy is been a bit shaky recently there are many individuals collectly unemployment and therefore the tax base supporting unemployment has been slowly depleted. In order to increase this revenue base the State of NJ will be moving to a new tax catagory which will automatically increase the revenues to support this base.

Without doing anything, your unemployment rate will be increased.

The State of New Jersey has over a 10% error rate in the payment of unemployment claims. That means they are taking too much money out of your account and that your rate is wrong!!

Been thru a merger, acquisition or restructuring?  The US Department of Labor statistics show there is close to a 50% chance the incorrect rate has been assigned to the new company. This stems from the governments inability to properly record these transactions.

Hutchinson Business Solutions has great success reviewing and validating if these unemployment rates are correct. Many of our clients are receiving refunds for overpayments! 

 

The state allows us to go back 3 years to verify if the current rate is correct. The state is not asking you to overpay taxes. The onus however is own you to provide the proper information.

What is your Rate?

 

What is your Reserve Balance?

How much have you paid out in claims?

 

Is your Rate correct?

Maybe today is the day to find out!

 

Call Hutchinson Business Solutions and ask about our no fee review of your current unemployment rate.

 

Our findings may surprise you.

 

You too may qualify for a refund!

 

Note:

This service available for companies with more than 150 employees.

Division of Employer Accounts FAQ

Employer FAQs

What reports am I required to file ?

Each quarter every employer who is subject to the New Jersey Unemployment Compensation Law is required to file a NJ-927, “Employer’s Quarterly Report,” and a WR-30,”Employer Report of Wages Paid.” 

 Must I file a quarterly report if I have no wages to report?

 YES. If you are subject to the New Jersey unemployment compensation law, you must file a NJ-927 and WR-30, indicating no wages paid. 

 What rates should I use when filing my reports ?

NEW EMPLOYERS RATES : Unless you are (or become) subject to the New Jersey unemployment compensation law under the “successor” provisions of the law, in most cases a new employer (one in business for less than three years) is assigned basic starting rates. For the periods shown, the basic rates are as follows:

Period                                         UI                DI         WF       FLI

07/01/09 to 06/30/10    2.6825%    0.5%    0.1175%   0.0%

07/01/08 to 06/30/09    2.6825%   0.5%    0.1175%    0.0% 

 EXISTING EMPLOYER RATES :

 Unemployment and Disability Insurance tax rates are assigned on a fiscal year basis (July 1 – June 30). Every subject employer receives a ” Notice of Employer Rates” (form AC-174.1) and its accompanying explanation at the beginning of each fiscal year. You may obtain your current rates by contacting the Experience Rating Unit.

WORKER RATES: For the periods shown, workers’ contribution rates for unemployment and state plan disability insurance are as follows:

Year                                                                        UI           DI           WF           FLI

2009/2010 (01/01/10 to 06/30/10) 0.3825% 0.5% 0.0425% 0.1200%

2009/2010 (07/01/09 to 12/31/09) 0.3825% 0.5% 0.0425% 0.0900%

2008/2009 (01/01/09 to 06/30/09) 0.3825% 0.5% 0.0425% 0.0900%

What is the taxable wage base ?

For the periods shown, subject employers must pay taxes on wages up to the following amount :

CALENDAR YEAR TAXABLE WAGES

2010 29,700

2009 28,900

2008 27,700

2007 26,600 

What are gross wages ?

Gross wages include every form of remuneration paid to an employee either directly or indirectly, including salary (sick leave pay, vacation pay, holiday pay, back pay awards), commissions, bonuses, and the cash value of all compensation in any medium other than cash as actually paid or otherwise distributed to the employee during the reported quarter. Payments in kind for personal service such as meals, board, or lodging received by a worker from his employing unit in addition to or in lieu of (rather than as deduction from) money are deemed to be remuneration.

What are the eligibility requirements for a reimbursement account ?

Eligibility: An organization must be defined as non-profit as described in section 501(C)(3) of the Internal Revenue Code and be exempt from Income tax under section 501(A) of the Internal Revenue Code to be eligible to become a reimbursement account. A non-profit organization that elects to reimburse the unemployment trust fund for benefits paid to its former employees is required to furnish proof of financial responsibility or file a surety bond with the New Jersey Department of Labor and Workforce Development.

New Employer: A newly subject employer must submit a written notice of intention to apply for the reimbursement option to the Division of Employer Accounts within 120 days of the date status is attained, or no later than 30 days from the date on which such an organization is notified of its subjectivity, whichever is later. Existing Employers: After reporting a non-profit contributory employer for a minimum of two calendar years, you may choose the reimbursement option of benefit payment by filing a written notice to that effect with the Division of Employer Accounts no later than February 1 of any calendar year. For additional information, please contact the Division of Employer Accounts : Employer Status Unit.

How do I amend a previously filed report ?

To amend your NJ-927 and/or WR-30 reports, you MUST amend them on-line only at the Division of Revenue web site. You may no longer submit an amended return on paper. Directions for completing the on-line amended return may be found at the Division of Revenue web site. http://www.state.nj.us/treasury/revenue/amdreturns.htm

How do I request a refund ?

EMPLOYER An employer who has overpaid tax contributions may request a refund by contacting the Division of Employer Accounts: Employer Refund unit, or by submitting a UC-9 “Employer’s Claim for Credit or Refund by Reason of Erroneous Payment of Contributions” with the division. If gross wages originally reported on the WR-30 for any individual employee were reported incorrectly, an amended WR-30 must be filed online and a UC-9 must be completed and mailed to the division. An employer is entitled to a refund of excess contributions paid, if requested no more than two years after the calendar year in which the erroneous payment was made. EMPLOYEE An employee who resides in New Jersey and overpaid worker contributions as result of working from more than one employer may take credit for the overpayment on the NJ1040. Non-residents may obtain a refund by contacting the Division of Employer Accounts: Worker Refund unit, or by submitting to the Division a UC-9A with copies of any W-2s showing excess deductions. An employee is entitled to a refund of excess contributions if the request is made within two years after the calendar year in which wages are paid.

What records must I maintain for my employees ?

Every individual, group of individuals, firm or organization that employs one or more persons on a permanent, temporary or part-time basis, whether or not they are subject to unemployment compensation law, must maintain and retain for the current year and four preceding calendar years the following records : Individual worker records: Full name, address, and Social Security number; The date hired, rehired, and returned to work after temporary layoff; The date separated from employment and the reason for such separation; The number of base weeks and wages; Total remuneration paid, showing separately: cash, commissions, and bonuses; reasonable cash value of remuneration paid by the employer in any medium other than money, including room and board, meals, tips; special payments such as bonuses, gifts, etc., which have been paid during the pay period but which relate to employment in prior period shall be shown separately under the heading: cash payments cash value of other remuneration the nature of such payments the period during which the services were performed for which special payments were paid Payroll Records: The full name of each employee and the days of the calendar week in which work was performed for remuneration; The beginning and ending dates of each pay period; The total amount of wages paid to each employee in each pay period; The total remuneration paid to all such individuals combined, separately by money and other remuneration in each pay period and in all pay periods within each quarter.

Am I required to register a family-operated business ?

A family-run business is exempt from the New Jersey unemployment compensation law if: The business is a sole proprietorship, and The only employees are parents in the employ of a son or daughter, or The only employees are children under the age of 18 in the employ of a parent.

How are unemployment benefits charged to my account ?

When unemployment benefits are paid to a claimant, a charge equal to the benefit amount is made to the account of the employer for whom the individual worked. If the claimant worked for more than one employer during the period on which the benefits are based, each base year employer is charged proportionally for each benefit payment, which is determined by the amount of wages that the employer paid the claimant during the base year and total wages received during that period. That is, under proportional charging, all base year chargeable employers share in the cost of each week of benefit payments. The employer is notified of these charges quarterly on the form B-187Q, “Unemployment Benefits Charged to Experience Rating Account.” employers should check these listings carefully against their payroll records to help prevent incorrect charges and improper benefit payments.

How can I reduce my UI/DI rates ?

You may reduce your UI/DI rates: Avoid fines by submitting all reports accurately and on time. Avoid unnecessary charges by reviewing determinations, appeals, decisions, and charge notices for accuracy. By making timely appeals on determinations, appeal decisions and charge notices that you believe to be erroneous. By attending appeal hearings and reporting fraud. By making voluntary contributions. By using the “exceptions address file” to have forms sent to the proper company location.

How do I grant power of attorney ?

You may grant power of attorney to another individual to represent you before the Division of Employer Accounts by submitting a power of attorney document containing: The corporate seal, unless the employer is an individual or a partnership; The signature of the employer(s) or duly authorized corporate officer; Specific mention of Employment Security as the entity before whom representation will be made on behalf of the employer; The signature of a notary public and the expiration date of commission; The signature of the representative and a statement acknowledging power of attorney authorization.

What is a private disability plan ?

A private disability plan is one in which temporary disability benefits are provided for workers by an agency other than the state. You may establish a private plan for the payment of disability benefits in place of the benefits payable under the state plan. Such a private plan may be a contract of insurance issued by an authorized carrier, by an employer as a self-insurer, or by an agreement between a union and an employer. The Bureau of Private Plans must approve all private plans. You must submit for review an application and complete description of the plan. To apply for a private plan, contact: Division of Temporary Disability Insurance Bureau of Private Plan Approval and Termination Section PO Box 957 Trenton, NJ 08625-0957 Telephone: (609)292-2720 Fax: (609)292-2537

How do I determine whether an individual who performs services for me is an independent contractor ?

 An employer is not liable for unemployment or temporary disability contributions for services performed by an independent contractor. To be considered as an independent contractor, an individual must retain all control or direction over the services rendered. In addition, the independent contractor must be customarily engaged in the established trade or business which should have been existence prior to its association with the employer, and which trade or business should be independent to the point that it could survive if the relationship between the employer and the independent contractor were terminated. An independent contractor advertises his or her services, is in a position to realize a profit or suffer a loss, and has an investment in its business.