Savings Will Help Businesses Work Through Tough Economy
TRENTON – Legislation that would cut the unemployment insurance tax rates that will be imposed on employers during the upcoming fiscal year was introduced in the Senate on Monday, a move that would help businesses in New Jersey work through the difficult economy and save or add jobs, according to Senator Fred Madden (D-Gloucester/Camden), the bill’s sponsor and chairman of the Senate Labor Committee.
“These savings are especially important to small businesses that are working hard to make it through the difficult economy,” said Senator Madden. “The reduced costs will help them retain and add employees at a time when we should do all that we can to create jobs and spur economic growth. This is good for employers and employees alike.”
The measure would suspend the 10 percent unemployment surcharge scheduled to take effect for FY 2014, giving employers an estimated savings of $293 million. Similar actions for FY 2013 and FY 2012 produced savings as well. Senator Madden said the three-year total savings could be close to $1.5 billion.
“We have worked in partnership with the business community to hold down unemployment tax increases while addressing the need to restore solvency to the Unemployment Trust Fund,” said Senator Madden.
The cost deferrals were recommended by the Unemployment Insurance Task Force, of which Senator Madden is a member. Specifically, the bill would base the employer UI tax on the “E” column of the tax table but without the 10 percent surcharge provided in the law.
“This is a tax break for employers designed to help businesses survive and thrive at a time when they face forceful economic challenges,” said Senator Madden. “This gives businesses a break but still maintains full unemployment benefits for the jobless.”