State unemployment insurance (SUI) is an employer-funded benefit available to eligible workers who become unemployed through no fault of their own (as determined by state law). An employer’s SUI rate may vary and is based upon wages and employment “experience.” Unemployment insurance is the only behavior-influenced employer payroll tax and as the client’s most trusted adviser, the CPA has a unique opportunity to ensure that each client is knowledgeable in the area of unemployment administration. By partnering with a third-party administrator that provides a state unemployment insurance (SUI) service, CPAs can help manage client unemployment costs effectively and make sure all is being done to reduce the amount of unemployment taxes paid. This, in turn, increases the clients’ perception of the CPA’s delivered value.

Preventing just one claim or obtaining credit for erroneous charges can result in business savings. Employers can keep their unemployment costs down by knowing their state’s rules for claim responsibilities and actively managing the areas below:

• Provide written agency policies to all employees.
• Become knowledgeable in the area of Benefit Charge History — this is the record of unemployment benefit charges an employer has had to pay for unemployment claims. When properly monitored for erroneous charges, this can affect the employer’s tax rate; the fewer the claims the employer has experienced, the lower the SUI tax rate.
• Documentation — provide each employee a written Notice of Change of Employment immediately upon separation or leave of absence.
• Respond to claims and make any appeals within the required time frames.
• Keep any records relating to unemployment insurance for four years.
• Work with a third-party administrator to manage SUI responsibilities.

Signs for consulting opportunities to help your clients with better SUI management techniques include:

• Clients with high turnover.
• Clients with a SUI rate significantly higher than the standard new business rate (set by each state).
• Clients without a human resource manager or a dedicated person with the needed expertise to handle unemployment paperwork and administration.

Working with a third-party administrator’s SUI service can relieve your clients of the time, work and cost associated with unemployment administration. Evaluate their current unemployment administration and let them know about the SUI Service in partnership with Paychex.

Paychex’ SUI service includes: claims management, benefit charge auditing, recordkeeping, toll-free support line, management reports and more. Paychex can also help reduce unemployment compensation costs by checking for erroneous charges, which may lead to a lower SUI experience rating. Paychex takes care of all the required details so clients can focus on more profitable activities to grow their business. For more information on Paychex SUI Service, visit www.paychex.com.