Unemployment Law Changes Take Effect in New Jersey

Unemployment Law Changes Take Effect in New Jersey

New Jersey has undergone a change to their employer unemployment tax law, effective July 1st, 2010, due to New Jersey Governor Chris Christie’s vetoing of a bill to limit the impact of an unemployment tax increase on businesses. Governor Christie believes that the proposed bill he vetoed does not go far enough towards reforming the insurance fund of New Jersey. Christie’s ultimate goal is to make it more difficult for individuals fired from positions due to misconduct reasons to collect benefits and to also decrease the deficient in the NJ Insurance Fund.

What did the original bill entail?

The bill was originally designed to allow an automatic tax increase of $400 per employee on businesses. It now calls for an increase of about $130 per worker instead.

Since the proposed bill was vet

oed by Governor Christie, what does this mean for employer unemployment tax rates?

Unemployment insurance tax rates will be set into the "C" column of the UI tax table in R.S.43:21-7. The UI tax rate charged to employers during the state's FY 2009 Budget was based on column "B" of the tax table, which will now increase to the highest tax rates under current law. These rates, found in the "E" column plus an additional 10% surcharge would be
imposed on NJ employers.

Which employees of employers does law affect?

If workers made more than $1,000 in any calendar quarter in the current year or the year before, the employer must pay the unemployment tax due.

What are Governor Christie’s goals for unemployment legislation?

Governor Christie’s goals include: maintaining reforms on unemployment insurance eligibility, minimizing the tax impact on businesses, and setting a course for the effort to return the unemployment fund to solvency. He is quoted saying: "There is no question that such an onerous a tax hike right now on New Jersey's job creators would seriously damage our economy and derail our recovery… I am thankful to the Legislature and the bill's sponsors for coming together to mitigate the financial impact on our state's small businesses, while taking the necessary steps to begin restoring solvency to the system."

How much will this law affect the US unemployment rate?

It has an estimated annual

savings of between $150 and $175 million.

Blog Posed by: Anne Dammel, Marketing Coordinator, CPS (908) 704-1550 ext. 21adammel@completepersonnel.com