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February 8, 2021
2021-0289

New York legislation relieves employer unemployment insurance accounts of COVID-19 benefit charges

New York Governor Andrew Cuomo signed into law S1197, which provides that unemployment insurance benefits paid in connection with COVID-19 will not be charged to employer accounts for experience rating purposes. The noncharging provision also applies to reimbursing employers (nonprofit and governmental employers) to the extent allowed under federal law.

The law is effective March 12, 2020 and is repealed after December 31, 2021.

This relief applies to unemployment insurance claims that are due to the closure of the employer, a reduction in the employer's workforce due to COVID-19 or a governmental order to close the business due to COVID-19.

Prior to the enactment of S1197, the New York Department of Labor took the position that the only COVID-19 unemployment insurance benefits that would not be charged to employer accounts were those reimbursed to the state's trust fund by the US Department of Labor, making it unclear whether regular benefits paid in connection with COVID-19 would be charged to employers' accounts for experience rating purposes. (EY Tax Alert 2020-1184, 5-1-2020; New Department of Labor COVID-19 Frequently Asked Questions for Employers.)

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

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