How does a company pay unemployment benefits through NYS Department of Labor?
I'm starting a small business in New York and trying to understand how the unemployment system works from the employer side. How exactly does a company pay unemployment benefits? Do I pay directly to employees who file claims, or does it go through NYS Department of Labor? I'm confused about the whole process and want to make sure I'm doing everything correctly from day one.
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Ahooker-Equator
Companies don't pay unemployment benefits directly to employees. You pay unemployment insurance taxes to NYS Department of Labor, and then NYS Department of Labor pays the benefits when someone files a valid claim. You'll need to register with NYS Department of Labor as an employer and start paying quarterly UI taxes based on your payroll.
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Abigail bergen
•Thanks! So the taxes I pay create a pool that NYS Department of Labor uses to pay claims? What happens if multiple employees file claims - do my taxes go up?
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Anderson Prospero
Your unemployment tax rate depends on your company's claim history. New businesses start with a standard rate, but if you have a lot of former employees filing successful UI claims, your rate increases. It's called experience rating. Keep good documentation of any terminations because you can contest claims if someone was fired for misconduct.
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Tyrone Hill
•this is why so many companies fight every claim even when they shouldn't... it affects their rates
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Toot-n-Mighty
When someone files for unemployment from your company, NYS Department of Labor will send you a notice asking for information about why they left. You have like 10 days to respond. If you don't respond or if they qualify, NYS Department of Labor pays them from the unemployment fund that all employers contribute to through taxes.
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Abigail bergen
•Good to know about the 10 day deadline. Is there a specific form I need to fill out when I get one of these notices?
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Lena Kowalski
I've been dealing with this for years and honestly the whole system is frustrating. NYS Department of Labor will approve claims even when you provide clear evidence someone quit without good cause or was fired for attendance issues. Then your rates go up and there's nothing you can do about it. The appeals process is a joke.
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Ahooker-Equator
•You can appeal claim determinations if you disagree. The key is having solid documentation and responding quickly to all NYS Department of Labor requests for information.
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DeShawn Washington
Just went through this last month when I had to let someone go due to budget cuts. NYS Department of Labor approved their claim (which was correct since it was a layoff) and my accountant explained that my UI tax rate might increase next year depending on my overall claim history. The system makes sense once you understand it.
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Mei-Ling Chen
yeah my boss always gets mad when people file unemployment like it comes out of his pocket directly lol
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Anderson Prospero
•Well, it kind of does in the long run through higher tax rates, but you're right that he doesn't write a check directly to the employee.
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Diego Vargas
As someone who just went through the employer registration process with NYS Department of Labor, here are the key steps: 1) Register online through the NYS Business Express portal, 2) You'll get assigned an unemployment insurance account number, 3) File quarterly wage reports (Form NYS-45) and pay UI taxes based on your payroll. The current new employer rate is around 4.1% on the first $12,300 of each employee's wages. Make sure to keep detailed records of hiring dates, wages, and any separations - you'll need this info for the quarterly reports.
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