Massachusetts Unemployment Insurance-Understanding 
and Controlling Your Rate

In 2004, Massachusetts adjusted their unemployment rates upward to compensate for the depletion of the Unemployment Fund over the past couple of years. Many employers have experienced dramatic increases that have amounted to over 300% jump.

In order to control your rate, you need to understand how the actual calculation works:

• The base salary has jumped from the first $10,800 to $14,000.

• The rate tables have been expanded to go up to 10.96%. Added to that is a .06% charge for the Workforce Training Fund Contribution. 

• The Solvency Account adjustment has increased to 1.53% for all employers.

• The rate is determined by taking your account balance as of 10/1/02 and adding to it your contribution for 10/31/03 and making an adjustment for the solvency assessment. The result is your account balance as 10/31/03. This number is divided by your wage base and the result is your reserve percentage. The reserve percentage can be positive or negative and determines your UI Contribution rate. 

   

  For example:

  
  

  Beginning Account Balance as of 10/1/02	-$17,000
  Contribution paid in through 10/31/03	16,000
  Benefit Charged to Account	-  55,000
  Solvency Assessment (Wage Base times .0153)	-   4,200
  Account Balance	-60,200
  Wages Subject to Contribution	280,000
  Reserve Percentage	-21%
  UI Contribution Rate See Attached Schedule D	10.96%

• You have the right to request a review of your rate. This has to be done by June 20, 2004 in writing. You need to review each number, especially the benefits charged to your account and see if any of them should be contested.

• You should put a policy in place in how you are going to handle claims on a prospective basis. The question of whether or not a former employee is eligible to collect unemployment insurance is tricky and it is important that all of the paperwork is reviewed and any potential hearings get the proper attention.

• There are consultants in this area and it may be a consideration for future handling of claims.
  
  Please call us for any help. More information can be obtained at www.mass.gov/det.

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