2014 guide to unemployment insurance

State unemployment insurance

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Federal law allows the states, within certain limits, to determine how employer state unemployment insurance (SUI) rates will be determined. SUI contribution rules vary depending on if the employer is reimbursing or experience-rated.

  • Experience-rated employers. All private businesses are assigned an SUI rate based on their experience. SUI contributions are computed by multiplying each employee’s wages up to the state’s wage limit by the SUI rate assigned to the employer.
  • Reimbursing employers. Nonprofit and governmental employers may be experience-rated or they may elect to be reimbursing. Reimbursing employers generally repay UI benefit charges dollar for dollar.

In all cases, the UI benefits paid to an employer’s separated workers directly affect the employer’s SUI costs. For experience-rated employers, the following state-driven factors can directly or indirectly determine the SUI tax they will pay:

  • State jobless rate
  • Minimum and maximum UI benefits
  • SUI wage base
  • Rate determination method
  • New employer and experience rates
  • Special surcharges and assessments
  • Statutory elections that can lower the SUI rate
  • Rules governing transfer of wages and experience (mergers, acquisitions and employee transfers)
  • Penalty SUI rates

EY - 2014 state wage base

EY - 2014 state wage base