2023 Massachusetts General Laws › Part I - Administration of the Government › Title XXI - Labor and Industries › Chapter 151a - Unemployment Insurance › Section 14 - Contribution Rates in General; Contributions in General; Definitions; Notice of Payment of Benefit and Potential Charges; Review; Transfer of Business

Section 14. Each employer shall make contributions for each year after nineteen hundred and ninety-one at the applicable rate or rates as set forth in this section on so much of its payroll as is subject to this chapter. For the purposes of this section, the term ''wages'' shall not include that part of remuneration which, after remuneration equal to the unemployment insurance taxable wage base with respect to employment with such employer has been paid to an individual during any calendar year, is paid to such individual during such year; provided, however, if the amount specified in the definition of ''wages'' in the federal Unemployment Tax Act is higher with respect to a calendar year than the amount hereinbefore specified, such higher amount shall apply to such calendar year. For the purposes of this section, remuneration shall include any wages earned in another state upon which contributions were required and paid under a similar law.
In addition, an employer who has been assigned a contribution rate pursuant to paragraph (1) of subsection (i), has filed all reports required under this chapter and has paid all contributions, interest and penalties due under this chapter, may make voluntary contributions. Such voluntary contributions shall be paid not later than 30 days after the date on which the division has issued a notice of the employer's contribution rate pursuant to subsection (m) or prior to the expiration of 120 days after the start of the calendar year for which the contribution rates are effective, whichever is earlier. Upon timely payment of a voluntary contribution, the contribution shall be credited to the employer's account balance and that employer shall receive a recomputation of its contribution rate for that calendar year. No voluntary contribution shall be refunded in whole or in part.
All contributions paid by employers shall be pooled and available to pay any benefits required under this chapter. The accounts hereinafter established and maintained are book accounts for the calculation of the contributions to be paid by each employer subject to this chapter.
(a) The following words and phrases as used in this section shall have the following meanings, unless the context clearly requires otherwise:
(1) ''Experience rate'', the contribution rate which conforms to the reserve percentage of an employer's account under subsection (i) of this section.
[Paragraph (2) of subsection (a) applicable as provided by 2014, 144, Sec. 78.]
(2) ''Reserve percentage'', in relation to an employer's account, the net balance of such account on a computation date stated as a percentage of the average of the employer's total taxable payroll for the 3 years prior to said computation date, except that if an employer has no taxable wages but has a balance, such employer's reserve percentage shall be deemed to be zero positive if the account balance is positive; or, fourteen per cent negative if the account balance is negative. If an employer has no taxable wages and has a zero account balance, such employer's reserve percentage shall be deemed to be zero positive. In relation to the solvency account ''reserve percentage'' shall mean the annual balance of said account on a computation date as determined under subsection (f) stated as a percentage, rounded up to four decimal places, of the average of the total taxable payrolls reported by all employers whose experience rate is determined pursuant to paragraph (1) of subsection (i), for the 3 years preceding said computation date. In relation to the unemployment compensation fund, ''reserve percentage'' shall mean the balance of said fund, excluding the accounts established under subsection (f) of section fourteen C, on a computation date stated as a percentage of the average of the total payrolls reported by all employers liable for contributions pursuant to section 14 for the 3 years immediately preceding said computation date.
(3) ''Computation date'', except as provided in subsection (n)(4) of this section, the computation date will be September thirtieth of each year.
(4) ''Unemployment insurance taxable wage base'', with respect to calendar years beginning on or after January 1, 2015, the term ''unemployment insurance taxable wage base'' shall mean ''$15,000''.
(b) No employer shall be assigned an experience rate of less than five and four tenths per cent with respect to any calendar year beginning on or after January first, nineteen hundred and eighty-five unless, as of the computation date applicable to such year:—
(1) Benefits have been or could have been charged to the employer's account throughout the twelve consecutive months' period ending on such date; and
(2) Such lower experience rate applies under subsection (i); and
(3) Permitting him to pay such lower experience rate is consistent with the conditions applicable to additional credit allowance under section 3303(a) of the federal Unemployment Tax Act, any other provision of this chapter to the contrary notwithstanding.
(c) The commissioner shall establish an employer's account for each employer who is subject to this chapter and shall also maintain a solvency account.
(d) The commissioner shall determine the charges and credits to each employer's account, as follows:
(1) An amount equal to all contributions paid by an employer shall be credited to his account as of the date when such contributions were paid; provided, however, that any such contributions paid during the month of October shall be credited as of the immediately preceding September thirtieth.
(2) An amount equal to the amount of contributions refunded to any employer in accordance with the provisions of section eighteen shall be charged to the employer's account as of the date when refunded.
(3) An amount equal to the benefits provided in subsections (a) and (b) of section twenty-nine and paid to each individual with respect to a benefit year shall be charged as of the date paid to the accounts of the employers who reported base period wages which were used to establish such benefits. For the purposes of this subsection, such charges shall be made to the accounts of the most recent and next most recent employers in the inverse chronological order of the base period employment of the individual; provided, that whenever it is found that such individual was in employment with two or more employers in any quarter of the base period and the order of such employment cannot be readily determined, the commissioner shall prescribe the manner in which such charges will be made. Charges made to employer accounts because of benefits which are later determined to have been erroneously paid shall be removed from the employer accounts and charged to the solvency account as of the date discovered, except that such charges shall not be so removed in any instance where the employer has failed to return notice of claim filed as required under the provisions of section thirty-eight. With respect to any claim filed, if any base period employer shall show to the satisfaction of the commissioner that the worker became separated from his last employment with such employer for reasons which would have resulted in a denial of benefits to the worker under the provisions of section twenty-five (e) had such base period employer been his most recent employer, charges with respect to benefits paid to such a worker shall not be chargeable to such employer's account but shall be charged to the solvency account. If a base period employer recalls an employee to work during the benefit year and the employee subsequently leaves such employment within the benefit year for reasons which would result in the denial of benefits under subsection (e) of section 25 had such employer been the employee's most recent employer, then any benefits paid to such employee following that separation which, in accordance with this paragraph, would be charged to such base period employer's account shall not be so charged but shall be charged to the solvency account. Benefits which, in accordance with the provisions of this paragraph, would be charged to an employer's account shall not be so charged but shall be charged to the solvency account in any case where no disqualification is imposed under the provisions of clause (1) of subsection (e) of section twenty-five because the individual's leaving of work with such employer, although without good cause attributable to the employer, was not voluntary, or was due to domestic violence.
(e) The commissioner shall determine the credits and charges to the solvency account as follows:—
(1) An amount equal to all interest earnings or other revenue received by the fund which is not credited to employers' accounts shall be credited as received to the solvency account.
(2) Any plus or minus balance remaining to the credit of an employer's account after he has ceased to be subject to this chapter shall be charged or credited, as the case may be, to the solvency account; provided, that an amount equal to benefits thereafter paid based on wages reported by such employer shall be charged to the solvency account.
[There is no paragraph (3).]
(4) An amount equal to the amount of any restitution by an employee of benefits improperly paid to him, whether such restitution is in cash or in the form of offset against benefits otherwise due, shall be credited to the solvency account when such restitution is made.
(5) Whenever, as of any computation date, an employer's account has a negative reserve percentage of more than twenty-five per cent, the amount by which the negative balance of its account exceeds a negative reserve percentage of twenty-five per cent shall be credited to the employer's account as of said computation date and charged to the solvency account as of the first day of October immediately following the computation date.
(6) Whenever, as of any computation date, an employer's account has a reserve percentage of more than fifty per cent, the amount by which the balance of its account exceeds a reserve percentage of fifty per cent shall be charged to the employer's account as of said computation date and credited to the solvency account as of the first day of October immediately following the computation date.
(7) Any disbursements from the fund which are not chargeable to employer accounts shall be charged to the solvency account.
(f) As of any computation date after nineteen hundred and eighty-four, the balance of the solvency account shall be determined by the commissioner after applying such credits and charges to the solvency account as provided by subsection (e).
(g) The commissioner shall make available to each employer and to the public at least once a year a summary statement of the condition and classified transactions of the solvency account.
(h) The total taxable wages required for the determination of the experience rates shall be determined not later than November 30 of each year.
[Paragraphs (1) and (2) of subsection (h) applicable as provided by 2014, 144, Sec. 78.]
(1) The commissioner shall determine each employer's total taxable wages for the 3 year period immediately preceding the applicable computation date for the purpose of determining the employer's experience rate for the next succeeding calendar year. If it is found that any employer has not reported his taxable wages for any quarter pertinent to the determination, the total taxable wages for such quarter shall be determined by the commissioner in such manner as he may prescribe.
(2) For the purpose of determining the reserve percentage in the solvency account the commissioner shall determine the total taxable wages of all employers in the commonwealth, whose experience rate is determined pursuant to paragraph (1) of subsection (i) for the 3 year period previous to the applicable computation date and shall prescribe the procedure and methods by which such total taxable wages shall be determined.
(3) For the purpose of determining the contribution rate schedule provided for in subsection (i), the Unemployment Compensation Fund available for benefits as of any computation date shall include the amount of any federal reimbursable benefits due, but not credited, to the fund.
(i) The contribution rate of each employer shall be five and four-tenths percent of that part of its payroll subject to this chapter, except as follows:
(1) With respect to calendar years beginning on or after January 1, 2015, the experience rate of an employer qualifying therefor under subsection (b) shall be the rate which appears in the column headed by the unemployment compensation reserve percentage as of the applicable computation date and on the line with the applicable employer account reserve percentage as set forth in the experience rate table:
(2) Except as otherwise provided in this paragraph, each employer
(2) Except as otherwise provided in this paragraph, each employer newly subject to this chapter shall pay contributions at the rate which appears in the column headed by the unemployment compensation fund reserve percentage as of the applicable computation date and on the line with an employer account reserve percentage of 10.5 but less than 11.0 positive as set forth in the experience rate table hereinabove until it has been an employer for not less than the twelve consecutive month period specified in paragraph (1) of subsection (b); thereafter, its contribution rate shall be determined in accordance with the preceding provisions of this subsection.
(3) Any newly subject employer classified in the 2 digit North American Industry Classification System code 23 shall pay contributions at a rate equal to the average rate as of the most recent computation date paid by all employers so classified. Said employer shall pay at such average rate until it has been an employer for not less than the twelve consecutive month period specified in paragraph (1) of subsection (b); thereafter, its contribution rate shall be determined in accordance with the preceding provision of this subsection.
(4) Any nonprofit organization which has given notice in accordance with paragraph (3) of subsection (a) of section fourteen A to terminate its election shall pay contributions from the effective date of such election at the rate which appears in the column headed by the unemployment compensation fund reserve percentage as of the applicable computation date and on the line with an employer account reserve percentage of 0.0 but less than 0.5 positive as set forth in the experience rate table of subsection (i), or 5.4 percent, whichever is the lesser, until it has been an employer subject to such contributions for not less than a twelve consecutive month period specified in paragraph (1) of subsection (b); thereafter, its contributions rate shall be determined in accordance with the preceding provisions of this subsection.
(j) For any calendar year beginning on or after January first, nineteen hundred and eighty-five, each employer whose experience rate is determined under paragraph (1) of subsection (i) shall have its account as of a computation date adjusted by the product of the reserve percentage for the solvency account and the employer's total taxable payroll for the period of twelve consecutive months ending on said computation date.
(k) Except as otherwise provided in this subsection, whenever an individual is paid benefits for the first compensable week of unemployment with respect to his base period wages with any employer and because of such payment the account of such base period employer has been charged, as provided in paragraph (3) of subsection (d) of this section, the commissioner shall, following the close of the month in which such payment was made, promptly notify the employer whose account is charged by mailing him a form of notice identifying the employer, the payee, the first and subsequent weeks compensated during such month, the amounts paid and the total potential charge. If such employer has reason to believe that no charges with respect to such base period wages should be made to his account, he may return the said notice to the commissioner with the reasons stated thereon within thirty days after the mailing of said notice in accordance with the procedure prescribed by the commissioner. Failure to return said notice and reasons within the time provided in this section, or failure in accordance with the provisions of section thirty-eight to return the notice of claim filed which was given to him by the commissioner or his authorized representative with respect to a claim filed by said worker in the base period or filed previously in the current benefit year, shall bar the employer from being a party to further proceedings relating to such charge. The commissioner or his authorized representative shall promptly determine, in accordance with the procedure established by the commissioner, and after making such inquiries and investigations as he deems necessary, whether or not such benefits should have been charged and shall promptly give notice of such determination, together with the reason therefor, to the employer. Such employer may, within twenty days after the date of mailing of notice of such determination, request that the commissioner grant a hearing for the purpose of reconsidering the facts submitted and to consider any additional information. The commissioner or his authorized representative shall conduct such hearing in accordance with the procedure prescribed by the commissioner and shall affirm, modify or revoke the determination. Notice of his finding shall be mailed to the employer and this decision shall be final.
Such monthly notification of benefit charges to the account of a base period employer, as provided by this subsection and subsection (l) of this section, shall not include any benefits paid during the pendency of a final decision of such payments as provided in section forty-two B.
(l) The commissioner shall, promptly after the close of each month, mail to each employer a statement showing the charges to the employer's account during such month. Any such employer may apply for a review of said charges provided that such application is filed within thirty days after the date of the mailing of the statement. Unless an employer properly files for such a review the charges as made will become final.
(m) The contribution rate for each employer for a given calendar year shall be determined and the employer notified thereof as soon as practicable after the computation date, but in no event later than ten days prior to the due date of the first contribution of the year. Any such employer may apply to the commissioner for a review as to the determination of his contribution rate provided that such application is filed within sixty days of the date of such determination.
(n) (1) If the entire organization, trade or business of an employer, or substantially all the assets thereof, are transferred to another employer or employing unit and the transferee continues such organization, trade or business, the transferee shall be considered a successor for the purpose of this section. Written notice of the transfer shall be given to the commissioner by all transferring employers and successors within 120 days of the date of transfer. Successors shall be barred from taking over the account of any transferring employers having a plus balance if the transferring employers have not filed all reports and paid all contributions required of the transferring employers under this chapter through the end of the quarter preceding the date of transfer; but, no successor shall be denied the transferring employer's plus balance if the successor files all reports and pays all contributions required of the transferring employer within 30 days after mailing of the notice of determination. If the commissioner allows the transferee to take over the account of any transferring employer having a plus balance, the commissioner shall notify the transferring employer of the allowance. The transferring employer may, within 10 days after the date of mailing of the notice, request a hearing for the purpose of reconsidering whether the transfer of the account balance should be allowed. The hearing and any subsequent appeal shall be in accordance with the procedures prescribed by and pursuant to section 12.
(2) The successor shall take over and continue the employer's account, including its plus or minus balance and all other aspects of its experience under this chapter. The successor shall be secondarily liable for any amounts owed by the employer to the fund at the time of such transfer.
(3) The account taken over by the successor employer shall remain liable with respect to accrued benefits and related rights based on employment in the transferred business, and all such employment shall be deemed employment performed for such employer.
(4) For the calendar year in which a transfer occurs which results in a transfer of an employer's account, the contribution rates of the transferring employer and successor shall be determined as follows:
1. Any transferring employer or successor which had a contribution rate applicable to it for that calendar year shall continue with such contribution rate.
2. If a successor had no contribution rate applicable to it for that calendar year, and only one transferring employer is involved, the contribution rate of the successor shall be the same as that of the transferring employer.
3. If a successor had no contribution rate applicable to it for that calendar year, and two or more transferring employers are involved, the contribution rate of the successor shall be the highest rate applicable to any of the transferring employers.
(5) For the calendar year in which a transfer occurs which does not result in a transfer of an employer's account, any transferring employer or transferee which had a contribution rate applicable to it for that calendar year shall continue with such contribution rate. If a transferee had no contribution rate applicable to it for that calendar year, the contribution rate of the transferee shall be the rate which appears in the column headed by the unemployment compensation fund reserve percentage as of the applicable computation date and on the line with an employer account reserve percentage of 0.0 but less than 0.5 positive as set forth in the experience rate table of subsection (i), or five and four-tenths per cent, whichever is the lesser.
[There is no subsection (o).]
(p) Benefits shall not be charged to an employer's account to the extent that the unemployment compensation fund is reimbursed for such benefits pursuant to section one hundred and twenty-one of P.L. 94–566 for benefits paid to an individual whose base period wages include wages for previously uncovered services as defined in section one A.