06 August 2020

Nevada plans to relieve employer UI accounts of COVID-19 benefit charges; use of federal funding to bolster the UI trust fund under consideration

According to a media relations office representative of the Nevada Department of Employment, Training and Rehabilitation (Department), employers will soon see their unemployment insurance (UI) relieved of COVID-19-benefit charges.

In an email response to our inquiry, the representative stated: "The Department of Employment, Training, and Rehabilitation is exploring options to provide relief of charges as outlined in the Families First Coronavirus Response Act (FFCRA). Affected employers will be notified of how charging relief will occur once the process for providing this relief is finalized."

See the U.S. Department of Labor's Unemployment Insurance Program Letter 13-10 for an explanation of the noncharging provisions under the FFCRA.

A recently updated notice on the Department's online Employer Self Service (ESS) system website also states that the first quarter 2020 UI benefit charge statements for contributory employers and billing statements for reimbursing employers were posted online beginning May 22, 2020. Employers may view these statements within their ESS accounts. Once the Department has released its plan for non-charging employers with COVID-19 UI benefits, employers should carefully review future benefit statements to confirm COVID-19-related benefit charges are reversed for applicable workers.

Nevada could be planning to use a portion of federal funding to bolster the UI trust fund

Even if COVID-19 UI benefits are not charged to employer accounts, the effect of these benefits on the state's UI trust fund is expected to significantly increase employer tax rates through the use of higher tax rate schedules.

According to a document released by the governor's office in July 2020, the state may be considering the use of a portion of the federal funds provided under the Coronavirus Aid, Relief, and Economic Security (CARES) Act to bolster the state's UI trust fund, which has been dramatically affected by the amount of UI benefits paid out since the start of the COVID-19 emergency. (Press release, governor's office, 7-13-2020.)

Specifically, the document states:

Since February 2020, more than one in four Nevada workers have been displaced statewide, pushing the state's unemployment rate to 30.1%, the highest level ever reported by any state in modern history and generating an UI caseload orders-of-magnitude higher than anything the state has witnessed previously. While other sections of the CARES Act include funding for certain UI costs, the funding and uses are limited. To the extent allowable … Nevada is reviewing options for additional support and improvement in the state's unemployment system with funds available.

Work-search requirements and one-week waiting period waived for workers filing COVID-19 UI benefit claims; employers may report job refusals

Nevada Governor Steve Sisolak previously issued a news release that provides a waiver of work-search requirements and the one-week waiting period for workers filing COVID-19 UI benefits. See the Department's website for more on these COVID-19 UI benefits provisions.

As businesses reopen and employees are called back to work, the Department reminds employers that Nevada law prohibits individuals from receiving UI benefits if they refuse to accept offers of suitable work, or quit work, without good cause.

Employers may provide information regarding employees who refuse to return to the workplace by email to the Department's Business Service Office at JOBBANKMPKWY@detr.nv.gov with the subject line "Work Refusals."

Information provided should include: employer name, address, account number and contact person; the worker's full name; the last 4 numbers of the worker's Social Security Number; the date the employee was contacted and advised of a return to work date; and the reason the employee gave for not being able to return to work.

Ernst & Young LLP insights

Employers should carefully review future benefit charge statements to confirm the Department has properly removed COVID-19 UI benefit charges from their experience account.

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Contact Information
For additional information concerning this Alert, please contact:
 
Workforce Tax Services - Employment Tax Advisory Services
   • Kenneth Hausser (kenneth.hausser@ey.com)
   • Debera Salam (debera.salam@ey.com)
   • Kristie Lowery (kristie.lowery@ey.com)
   • Peter Berard (peter.berard@ey.com)

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ATTACHMENT

EY Payroll News Flash

Document ID: 2020-1997