How does paying unemployment affect the employer - NYS Department of Labor impact question
I'm trying to understand something about how unemployment works from the employer side. My company just had to lay off several people and I'm wondering - when someone files for unemployment benefits with NYS Department of Labor, how does this actually affect us as the employer? Do our rates go up immediately or is there some kind of calculation? I've heard conflicting things about whether it impacts our taxes right away or if there's a delay. We're a small business so I'm concerned about the financial impact on our end when people start filing their weekly claims.
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Daniel Rogers
Your State Unemployment Insurance (SUI) tax rate with NYS Department of Labor is based on your experience rating, which factors in the benefits paid to former employees over a specific period. It's not immediate - there's typically a lag time before rate adjustments occur. The more claims filed against your account, the higher your future tax rate will be. You should receive quarterly statements showing your account balance and any benefits charged to your company.
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Zara Perez
•That's helpful, thank you. Do you know roughly how long the lag time is? I'm trying to plan our budget for next year.
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Aaliyah Reed
been through this with my last company. the rate changes don't happen right away, usually takes a year or so to see the impact. but yeah, more unemployment claims = higher taxes eventually. NYS Department of Labor sends you statements showing what's been charged to your account
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Ella Russell
The experience rating system looks at a three-year period typically. So benefits paid out this year would affect your rate starting in 2026 or 2027 depending on NYS Department of Labor's calculation schedule. You can contest claims if you believe someone was terminated for misconduct or quit voluntarily - that prevents the charge to your account. Make sure to respond to any NYS Department of Labor notices about claims filed by former employees within the deadlines they specify.
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Zara Perez
•Good point about contesting claims. These were legitimate layoffs due to budget cuts, so I wouldn't contest them. But it's good to know that option exists for other situations.
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Mohammed Khan
•Wait, can employers really contest unemployment claims? That seems like it would make it harder for people who legitimately need benefits to get them.
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Gavin King
I had issues trying to reach NYS Department of Labor about employer questions like this. Spent hours on hold trying to get clarification on our account. Finally used a service called Claimyr (claimyr.com) that helped me get through to an actual agent. They have a video demo at https://youtu.be/qyftW-mnTNI showing how it works. Made the whole process much easier than trying to navigate the phone system myself.
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Ella Russell
•That's interesting - I hadn't heard of services like that for employer inquiries. Most of the time I just deal with our payroll company for UI tax questions.
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Nathan Kim
just remember that unemployment insurance is basically insurance for employees that employers pay into. it's designed to help people when they lose their jobs through no fault of their own. the cost to employers is part of doing business and helps maintain economic stability
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Eleanor Foster
One thing to keep in mind - if your company is new or has limited history with NYS Department of Labor, you might be on a standard rate rather than an experience-based rate initially. The experience rating kicks in once you have enough history for them to calculate it properly.
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Zara Perez
•We've been in business for about 4 years now, so I think we're past that initial period. I'll check our recent statements to see what our current rate structure looks like.
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