How does unemployment affect employer when multiple employees file claims?
My company had to lay off about 15 people last month due to budget cuts, and now I'm wondering how this affects our business. I know the employees can file for unemployment benefits through NYS Department of Labor, but does this impact our company in any way? Will our taxes go up or do we have to pay anything directly? I'm trying to understand the employer side of things since this is my first time dealing with layoffs.
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Kristian Bishop
Yes, unemployment claims definitely affect employers. Your company pays into the State Unemployment Insurance (SUI) system, and your tax rate is partially based on your claims history. When former employees file successful claims, it can increase your unemployment insurance tax rate for future years. The NYS Department of Labor tracks your 'experience rating' which determines your contribution rate.
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Eva St. Cyr
•So the more claims filed against us, the higher our taxes will be next year? That seems like it could really add up with 15 people.
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Kaitlyn Otto
yeah my old boss told me companies hate when people file unemployment because it costs them money somehow
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Axel Far
It's not quite that simple. NYS Department of Labor uses a formula that looks at your total payroll and claims over a three-year period. If you rarely have claims and this was an unusual situation, the impact might not be as severe as you think. However, you should receive notices about any claims filed against your account and you have the right to respond if you believe a claim shouldn't be approved.
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Eva St. Cyr
•What kind of situations would we want to contest? These were legitimate layoffs due to budget issues, nothing disciplinary.
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Axel Far
•For legitimate layoffs like yours, you typically wouldn't contest. You'd only contest if someone was fired for misconduct, quit voluntarily, or is making false statements about their employment. Layoffs due to lack of work are exactly what unemployment insurance is designed for.
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Jasmine Hernandez
I went through this nightmare trying to get information from NYS Department of Labor about our company's account status. Spent HOURS on hold just to understand our tax implications. Finally used claimyr.com to get through to an actual agent who could explain our experience rating. They have a video demo at https://youtu.be/qyftW-mnTNI that shows how it works. Made the whole process so much easier than trying to navigate their phone system.
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Eva St. Cyr
•Did they charge you a lot? I'm just trying to get basic information about how this will affect our business.
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Jasmine Hernandez
•It was worth it to actually talk to someone who could answer specific questions about our account. Way better than guessing or waiting weeks for a callback that never came.
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Luis Johnson
THE WHOLE SYSTEM IS DESIGNED TO SCREW SMALL BUSINESSES! They make it impossible to get straight answers about your tax rates and then hit you with massive increases. We had THREE claims last year and our rate went up 40%!
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Ellie Kim
•That does sound really high. Maybe there were other factors involved?
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Fiona Sand
Wait, so if I get laid off and file for unemployment, my former employer gets punished financially? That makes me feel kind of bad about filing... should I not apply for benefits?
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Kristian Bishop
•Don't feel bad at all! This is exactly what the system is for. Employers pay into unemployment insurance specifically to cover situations like layoffs. You earned those benefits through your work, and your employer was paying for this coverage all along. File your claim.
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