Unlike other human resource management issues, unemployment insurance (UI) management issues have a direct impact on an organization’s tax liability, and since taxes reduce profitability, on its bottom line. Unlike other payroll taxes, however, UI taxes are experience-rated and represent a controllable expense. Thus, an organization’s UI experience, influenced by its success in managing turnover, separations, and chargeable UI claims, provides an objective measure of human resource management effectiveness.

This interrelationship between human resource management and financial management stems from the unique nature of the nation’s UI program. The UI program is a joint federal-state partnership under which benefits in the form of a temporary, partial wage replacement are provided to unemployed workers who have lost their jobs through no fault of their own. The program attempts to draw a relationship between benefit entitlement and wages earned and between an employer’s benefits liability and the amount of wages paid by that employer. Within broad federal guidelines, each state is allowed to determine its taxing methods and benefits program.

The UI program is financed by two employer-paid UI taxes: A flat-rated federal tax and an experience-rated state tax.  NOTE: Governmental agencies and certain nonprofits are exempt from the federal UI tax. They may also elect to reimburse the state dollar-for-dollar for the UI benefits collected by their separated employees in lieu of paying the state’s experience-rated tax.

Cost control of the federal UI tax is achieved through the use of financial management techniques.  Cost control of state UI taxes is achieved through a combination of financial and human resource management activities. Cost control of an individual employer’s UI taxes and liability is achieved by stabilizing employment, taking advantage of tax-saving provisions in the law, using effective hiring, employment, and firing procedures, training supervisors on proper UI management, and implementing effective UI claims-hearing administration and management reporting systems.

Through effective UI cost management, organizations can control their UI tax liability and have a positive impact on their organizations” financial results.

Areas Covered

Course Level -  Basic Intermediate

Who Should Attend

Why Should You Attend

2022 state UI tax rates have been assigned….2023 state UI tax rates are being calculated. 

UI tax liabilities are the most obvious risk created by employee separations and unemployment insurance claims. Unfortunately, unemployment insurance claims also increase organizations’ exposure to other potential liabilities: from wage and hour violations for misclassifying independent contractors to providing plaintiffs with discovery opportunities for other employment litigation settings.

Effective management of your organization’s unemployment insurance experience can provide you with the opportunity to improve your talent management results, improve your hiring and onboarding processes, enhance your performance management and discipline procedures, and reduce your exposure to discrimination and wrongful discharge claims. Effective UI management allows your organization to use UI metrics to assess human capital risks, measure supervisor and manager performance, more accurately allocate resources, and have a positive impact on the bottom line.

This webinar provides an update on federal and state UI issues, discusses 2022 and 2023 state tax liabilities, assesses the risks and costs associated with UI taxes and benefits, and discusses effective UI tax management and cost control techniques. 

Topic Background

Unemployment Insurance, while often ignored, can provide critical information about the organization. In fact, it is one of the early assessment components of HR audits. Understanding the key elements of your unemployment insurance experience can provide your organization with important information about its financial and human resource management decision-making process.