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APA Comments on Federal Unemployment Insurance Improvement Act

BY: Mike Linehan | 12/13/21

The APA Government Relations Task Force Unemployment Insurance Workgroup submitted comments on S. 2865/H.R. 5507, the Unemployment Insurance Improvement Act, in late October. The APA supported the bill sponsors’ goals of improving the unemployment insurance (UI) system in the U.S., but highlighted concerns about the increased burden on payroll professionals and their employers.

The legislation is a pared down version of a similar bill that the sponsors released in the spring and seeks to tackle the most significant weaknesses in the UI infrastructure.

Proposed Reporting Requirements

The bill would require all state UI agencies to implement a system for employers to “provide information regarding claim-filing for unemployment compensation to employees upon separation from employment.” The bill also would call for state UI agencies to require employers to notify state workforce agencies of employees who may apply for unemployment compensation. If the bill becomes law, the reporting burden could greatly increase the workload of payroll professionals.

Proposed APA Solutions

To address these issues, the APA offered two solutions. To address the issue of reporting UI data, the APA urged legislators to consider the use of the State Information Data Exchange System (SIDES). For independent contractors, the APA recommended that legislators use the existing federal taxation structure to manage unemployment compensation taxes.

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Mike Linehan is the Assistant Manager of Government Relations for the APA.