04 May 2020 Utah COVID-19 UI benefits to be charged to social account, not directly to employer accounts The Utah Department of Workforce Services announced that individual employer unemployment insurance (UI) accounts will not be charged for workers' UI benefits attributable to COVID-19. Instead, these UI benefits will be charged to the Department's social cost account, which is used to spread the cost of UI benefits not charged to a specific employer's account to all employers as one of the elements of the annual contribution rate calculation. (COVID-19 and unemployment insurance, frequently asked questions for employers (FAQs), updated April 8, 2020.) According to the Department, effective immediately, all UI benefit costs attributable to COVID-19 will be charged to social costs instead of the employer's benefit ratio (basic tax rate). Currently social costs are .001, or $1 for every $1,000 of wages paid. An employer's UI tax rate for 2020 is already set and will not change due to COVID-19 or any other claims; however, the Utah UI tax rates for 2021 will include all UI benefits costs from July 1, 2019 through June 30, 2020, and three prior fiscal years. The UI tax rate for 2022 will include all benefits costs from July 1, 2020, through June 30, 2021, and three prior fiscal years. See Utah's online Employer Handbook for more information about social costs and UI tax rate calculations. Reimbursing employers that reimburse the Department for all UI benefits paid will continue to be billed for UI benefits attributable to COVID-19. However, the Department will allow these employers an additional month to make their monthly payment. According to the FAQ, the Department will allow reimbursable employers one additional month to pay their reimbursement/bill. For example, the reimbursement for unemployment insurance benefits paid during the month of February 2020 will be due by April 30, 2020. In addition, the Department will waive penalty and interest associated with late payments due to COVID-19 and will consider installment agreements provided the employer keeps their contact information current and remains in contact with the Department. Reimbursable employers are still required to file Form 794-N, Reimbursable Employment and Wage Reports, by the last day of the month that follows the end of each calendar quarter. Note that under the CARES Act, reimbursing employers are required to refunded up to 50% of the COVID-19 UI benefit claims that they reimburse to the state. We expect that Utah will soon update its guidance on reimbursing employers to reflect this federal provision. (See the U.S. Department of Labor's program letter to the states about COVID-19 UI benefits and reimbursing employers.) Work-search requirements may be waived for workers filing COVID-19 UI benefit claims, the one-week waiting period remains in effect In its FAQs for employees, the Department indicates that workers filing for UI benefits for reasons related to COVID-19 may be granted a waiver from the weekly requirement to search for work. However, the requirement to serve a one-week waiting period before receiving benefits currently remains in effect for COVID-19 UI benefits. For more information regarding the Department's response to COVID-19, go here.
Document ID: 2020-1206 | |||||||||||
