MA Employers Still Facing Enormous UI Tax Bills

Date: April 14, 2021

After months of NFIB successfully working on a UI tax relief bill with the Baker Administration, the Massachusetts Legislature, and other business groups, many employers were shocked to discover large UI tax bills in the first quarter. The bill passed last month froze rates at schedule E for two years to avoid massive rate spikes and to prevent employers from facing large bills. Yet employers ended up discovering enormous UI bills despite the efforts. Why?


In short, the reason was due to an increase in the UI Solvency Fund from .58% to 9.23%. This fund is traditionally meant to pay for dependency allowances and claims for businesses that shut their doors, but last year a law passed to charge the fund for COVID-related layoffs to prevent negative experience ratings for the many employers who reduced their workforce. Because of the major increase in claims utilizing the solvency fund, it needed to be balanced and triggered a higher rate on employers. This new solvency assessment rate was revealed on April 7th in a UI trust fund report as UI bills were already in the mail, with no prior notice or warning from state regulators of such a dramatic increase.


While we appreciate the advocacy from business owners urging a rate freeze, we are now asking that you help us with the next step: requesting lawmakers use some the federal aid to help partially replenish the UI Trust Fund. NFIB is working with legislators to find long term solutions, but in the meantime, Massachusetts must use federal dollars to provide immediate relief to business owners. We need a united voice from businesses contacting lawmakers on this issue. The state mandated you shut down, which was the cause of the vast majority of these layoffs, it should not be up to employers to solely replenish the fund. The state must shoulder some of the burden too.


This UI issue is not going away and we are making it the theme of our May 4th and 5th Virtual Small Business Day event. We ask that you mark your calendar to join us on your lunch hour for two days of advocating for UI tax relief. But until then, please use our issue alert here and contact lawmakers today and then pass it along to fellow business owners to do the same! 

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