Idaho Governor Brad Little signed into law H.B. 428 which, retroactive to January 1, 2024, staves off a large increase in state unemployment insurance (SUI) rates by lowering the multiplier from 1.3 to 1.2 in determining the size of the unemployment insurance (UI) trust fund.

The reduction in the multiplier to 1.2 lowered the 2024 SUI tax increase by 20%, resulting in net savings to employers of $44 million. It is anticipated that employer tax savings will be $117 million by the end of five years. (News release, March 6, 2024.)

Background

For the last three years, actions were taken to shield employers from higher SUI tax rates.

In 2021, Governor Little announced that he transferred $200 million of the state's share of federal Coronavirus Aid, Relief, and Economic Security Act (CARES Act) funds to the state's UI trust fund to keep the fund solvent and avoid doubling employers' SUI taxes in 2021. (News release, September 3, 2020; news release, Idaho Department of Labor, December 12, 2020.)

In 2022, Governor Little signed into law H.B 450, which gave employers stability and consistency in their SUI tax rates by extending the 2021 SUI rates for two years through 2023. It is estimated the legislation resulted in tax savings of $64 million for Idaho businesses in 2022 and 2023.

2024 SUI taxes

For 2024, the SUI wage base is $53,500.

After implementing the lower multiplier under H.B. 428, the 2024 adjusted range of SUI rates for experience-rated employers is 0.281% to 5.4%, lower than the range of 0.352% to 5.4% previously assigned. The adjusted 2024 SUI rates are slightly higher than the 2023 range of rates of 0.207% to 5.4%.

The 2024 adjusted new employer rate is 1.0%, lower than the 1.231% previously assigned for 2024. (Idaho Department of Labor, Rate Class Array.)

Ernst & Young LLP insights

The Idaho Department of Labor published revised 2024 employer SUI rate notices on March 22, 2024. Employers should confirm that they are using the correct SUI tax rate for taxable wages paid in 2024.