by Colin Leonard and James Rooney
A new law going into effect on January 1, 2014, will increase New York employers’ contributions to the state’s unemployment compensation program.
Earlier this year, legislation was enacted in response to the insolvency of the Unemployment Insurance Trust Fund and the state’s need to repay $3.5 billion borrowed from the federal government to cover increased costs during the recession.
One of the changes involves employer contributions based on the Federal Unemployment Tax Act (FUTA). Under the old law, the employer tax was based on the number of employees and the employer’s experience rating. The tax was assessed on the first $8,500 of each employee’s earnings. Beginning January 1, 2014, the tax will be assessed on the first $10,300 of each employee’s earnings, and the amount will gradually rise each year.