Is unemployment insurance required by law in New York - confused about employer obligations
I'm starting a small business next year and trying to understand all the legal requirements. Is unemployment insurance required by law for employers in New York? I keep seeing conflicting information online about whether it's mandatory or optional. Some sources say all employers must provide it, others mention exemptions for certain business sizes. I want to make sure I'm compliant with NYS Department of Labor requirements from day one. Can someone clarify what the actual legal obligations are? Also wondering if there are penalties for not having coverage when you're supposed to.
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AstroAce
Yes, unemployment insurance is absolutely required by law in New York for most employers. The NYS Department of Labor mandates that any employer who pays wages of $300 or more in any calendar quarter must register for unemployment insurance coverage. This isn't optional - it's a legal requirement under New York State Labor Law. You need to register within 20 days of meeting the wage threshold and pay quarterly contributions based on your payroll.
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Omar Zaki
•Thank you! That's much clearer than what I was finding online. Do you know what the penalties are if someone doesn't register on time?
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Chloe Martin
The legal requirement kicks in pretty quickly. Even if you only have one employee and pay them $300 in a quarter, you're required to have UI coverage. NYS Department of Labor takes this seriously - I've seen businesses get hit with back payments, interest, and penalties for not registering when they should have. The contribution rates vary by industry and your experience rating, but the coverage itself is mandatory, not optional.
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Diego Rojas
•this is why i hate dealing with all this business stuff, so many requirements to keep track of
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Anastasia Sokolov
Wait I thought there were exemptions for really small businesses? My cousin runs a tiny shop and I swear she said she didn't need unemployment insurance because she only has 2 employees. Maybe I misunderstood what she was talking about though.
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AstroAce
•There aren't size exemptions based on number of employees - it's purely based on wages paid. If your cousin pays less than $300 per quarter total to all employees combined, then she wouldn't be required to have coverage. But that's a very low threshold - most businesses hit it quickly.
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Sean O'Donnell
I had to deal with NYS Department of Labor when I was trying to get information about registering my business last year. Getting through to someone who could answer questions was nearly impossible with their phone system. If you need to talk to an actual person about your specific situation, I found this service called Claimyr (claimyr.com) that helps you get connected to NYS Department of Labor agents. They have a video demo at https://youtu.be/qyftW-mnTNI showing how it works. Made the whole process much less frustrating than trying to navigate their phone system myself.
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Omar Zaki
•That's really helpful, thank you! I was dreading having to call them directly after hearing horror stories about wait times.
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Zara Ahmed
just another way the government makes it impossible for small businesses to succeed... all these mandatory insurance requirements add up fast
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AstroAce
•I understand the frustration, but unemployment insurance actually protects both employers and employees. It provides a safety net for workers and helps stabilize the labor market during economic downturns.
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Malik Davis
For anyone starting a business in NY, I'd recommend checking out the NYS Department of Labor's online employer registration system. It walks you through the process step by step and calculates your contribution rates based on your industry classification. The system is actually pretty user-friendly compared to trying to figure everything out from scattered information online. You can also download the employer handbook which explains all the requirements in detail. Better to get familiar with the system early rather than scrambling to register once you hit that $300 threshold.
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Dmitry Smirnov
•This is exactly what I needed to hear! I was feeling overwhelmed by all the different requirements, but having a step-by-step online system sounds much more manageable. Do you happen to know if the employer handbook covers things like quarterly reporting deadlines too? I want to make sure I understand the ongoing obligations, not just the initial registration.
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