Evening star., 1943-10-12
Employers Save
$1,500,000 Job
Tax in Quarter
Marshall Reports
Reserve for Benefits
More Than Ample

proximately $l,500.O00 in unemploy-
ment compensation taxes during the
first quarter under the new law, as
compared with the last tabulated
three months of the old law, it was
estimated today by John A. Marshall,
executive director of the District Un-
employment Compensation Board
At the same time, the reserve fund
for the payment of benefits remained
more than ample, and the amount
of unemployment shrank to a new
low point under wartime conditions.
The District also was paying jobleSs
persons higher rates than under the
old law, with maximum compensa-
ton of $40 for 20 weeks in place of
sl8 for 10 weeks.
The last quarter under the old law
which had been computed COM
pletely showed that during January,
February and March of 1943 District
employers paid $2,064,OOO
The amended law, setting up an
experimenting system in place of
the fiat rate of 27 per cent which all
employers paid on their payrolls,
went into effect July /.
Graded Plan of Taxation.
While complete records have not
been compiled, an estimate based on
study OF returns thus far made
indicated that about ST 1,O50O 900 was
the total tax paid during July, Au-
gust and September.
The $l,500,0O0 estimated tax de-
crease represents the savings of the
55 per cent of local employers who
thus far have benefited under the
new law. The figures of S2O64 900
and $l,050000 represents total taxes
paid for the two contrasted quar-
ters and includes payments of en-
ployers who saved nothing.
The amended law is based on a
graded plan of taxation, under which
those employers who have dropped
the least number of employees pay the
smallest tax, while others pay in
proportion to the benefits which the
board is required to pay out for their
discharged workers The new rates
range from 81 per cent of the pay
roll downward to tenth of l per
cent.
A preliminary study of the records
at the DUG Board disclosed that
around SIS per cent of the employers
already had benefited from the new
law, sharing in the saving of ST.
100000.
Out of some $4,000 employers
8,437 qualified at once urder the
lowest rate provided in the new
law-one-tenth of l per cent.
Another 6.973 still were paying
the highest rate at the close of the
quarter, 81 per cent.
Rates of other employers were
divided as follows: For 70, it was
2 per cent; for 80, it was Is per
cent; for 202, l per cent; and Tor
ll9, one-half of per cent.
Mr.. Marshall explained that a
great majority of those required to
pay the old fat rate could not quail
ify under experience rating because
they had not been in business long
enough. The amended statute pro-
vides, in effect, that firm or in6i-
vidual must have been in business
four years to be eligible.
Few Fail to Benefit.
A small number failed to benefit
because of their employment records
Probably a considerable number OF
additional employers will be eligible
for experience rating when the next
tax rates are set, January l, Mr..
Marshall said. After that employ
ers will be rated once year.
Technically, the system is applied
by setting up a reserve fund for
each employer. 1t aCcumulates or
decreases according 10 the number
OF his discharged employees who are
found eligible for unemployment
compensation. His tax is based on
the state of this reserve, which is
matter of bookkeeping and not
to be confused with the huge gen.
eral reserve fund for the payment
of benefciaries which the DUG
Board keeps on hand
Of the $4,000 employers who thus
far have made returns for the first
quarter of the new law, about 10000
were small employers, hiring an
average of less than eight persons
each, Mr.. Marshall pointed out.
Complete COverage.
The District has, more complete
coverage than any State with un-
employment compensation. 1t re-
quires tax returns for a single en-
ploye, no matter how long he has
worked. The States require various
periods of tenure and pay before
the employer is placed on the tax
rolls
Around so per cent of Washing
tons employers paid a negligible
tax during the first period as COM
pared to what they have been pay
ing.
The wartime employment peak
was, of course, factor in reducing
the normal hazards of unemploy-
ment
Last week, for example, the board
sent out 497 checks.
During the same week last year
it mailed 984 checks For the cor
responding period of 1941 there
were 2490, and, during a similar
week in 1910, the board issued 3,785
The lowest benefit is Sc week
regardless of earning power. 1t is
graded upward to $40, depending on
the average pay which the applicant
has received.