November 14, 2019
New Jersey announces 2020 wage bases and tax rates for unemployment, disability and family leave insurance
The New Jersey Department of Labor and Workforce Development released the calendar year 2020 taxable wage bases used for state unemployment insurance (SUI), temporary disability insurance (TDI) and family leave insurance (FLI).
The 2020 employer/employee SUI taxable wage base increases to $35,300, up from $34,400 for calendar year 2019.
As we reported, legislation enacted earlier this year (A 3975) and effective January 1, 2020, separates the computation of the TDI/FLI taxable wage base from that of the SUI taxable wage base and increases the figure by almost four times the current level to fund expanded state TDI benefits that take effect July 1, 2020.(EY Payroll Newsflash Vol. 20, #092, 7-16-2019.)
The 2020 TDI/FLI taxable wage base increases to $134,900, even higher than the $131,000 estimate released when A 3975 was enacted.This is 3.82 times higher than the 2020 New Jersey SUI taxable wage base of $35,300.
Employee 2020 SUI-TDI-FLI tax rates
According to the Department's website, the following employee rates are in effect for the remainder of 2019 and for calendar year 2020:
Other SUI, TDI and WC amounts for calendar year 2020
Other SUI, TDI and Workers' Compensation (WC) totals for calendar year 2020 are as follows:
Value of room and board
In accordance with N.J.A.C. 12:16-4.8, the following are the calculated dollar equivalents for board and room, meals and lodging furnished by employers in lieu of money wages paid for services rendered by employees during the calendar year 2020:
If less than three meals per day, individual meals shall be valued as follows:
These amounts are used when the employer does not assign a value to such payments.
New Jersey fiscal year 2020 SUI rates remained on the same table as FY 2019
As we previously reported, employer SUI tax rates continue to range from 0.4% to 5.4% on Rate Schedule B for FY 2020 (July 1, 2019 through June 30, 2020). The new employer rate continues to be 2.8% for fiscal year 2020. (EY Payroll Newsflash Vol. 20, #101, 7-25-2019.)
These rates include the 0.1% Workforce Development Fund rate and the 0.0175% Supplemental Workforce Fund rate.
Although SUI tax rates are assigned on a fiscal year basis, employers should continue using the 2019 SUI taxable wage base of $34,400 for the third and fourth quarters of 2019. The 2020 taxable wage base of $35,300 goes into effect as of the first quarter 2020.
The employer FY 2020 SUI tax rate notices were issued during the fourth week of July 2019.
For more information on unemployment taxes in New Jersey, contact the Department at +1 609 633 6400 or see the Department's website.
Ernst & Young LLP insights
Employers may want to notify their employees now of the significant increase to the TDI/FLI withholdings beginning January 1, 2020.The updated FLI poster is available here.
EY Payroll News Flash