Posts Tagged ‘unemployment’

Updated: 12/06/2014 10:06 PM | Created: 12/06/2014 9:11 PM
By: Erica Zucco, KOB Eyewitness News 4

A local accounting firm says earlier this week, they received letters detailing how much their clients would need to pay into the state’s Unemployment Insurance Fund as part of new calculations set for 2015. For many of their clients, they say, it could be a bigger price tag than they expected.

“People are saying, ‘I don’t even see [the point of] being in business,'” accountant Anita Lovato said. “One of the ones that was $10,000 a year said, ‘It’s not worth it…it’s not worth fighting this.'”

Many small businesses have seen a tough few years – construction companies in particular. Less income meant cutting staff, something Empire Accounting says their clients didn’t take lightly.

“These people are New Mexico people who have small businesses…and a lot of them [are] family owned,” Lovato said.

Starting in 2015, businesses that had to do layoffs or firings that sent people into unemployment will pay more into that fund. Like with home or car insurance, those who use the fund more pay more, so some employers will see lower rates. But accountant Linda Sedillo worries that those who are about to shell out more are those who’ve already tightened their belts.

“I think it could lead to more unemployment. The construction industry especially has been affected so bad by the economy, and they are just now maybe starting to see things get better…and with these higher rates, they’re going to have to budget in $10,000 more a year… that’s impossible in this kind of economy,” Sedillo said.

Workforce Solutions released the following statement about the rate calculations:

“Strong bi-partisan legislation passed almost unanimously in 2013 changed the way in which employers’ contribution rates are calculated in New Mexico. For too long, politics drove how employer rates would be calculated in future years, leaving the entire business community in limbo, and jeopardizing the Unemployment Insurance Trust Fund solvency. Rates will now be more closely tied to employers’ actual benefit charges, and overall industry average. This change becomes effective in January, 2015.

Many experienced and new employers will benefit greatly from this new formula, with lower rates than in past years. Some employers, due to their industry or their actual history of benefit charges in the unemployment insurance program, may see increased rates.

Regardless of the size of a company, rates are driven by the employer’s individual experience with the program. Like a true insurance program, higher rates are driven by high usage of the program.

If any employer would like a review of their new rate or should have any questions they may contact the Unemployment Insurance Operations Center via email at uitax.support@state.nm.us or call 1-877-664-6984 (Option 3), Monday through Friday, 8:00 a.m. – 4:30 p.m.”