Employer tax cut with unemployment trust fund replenished

Employer tax cut with unemployment trust fund replenished

September 5th, 2013 by Dave Flessner in Local - Breaking News

Tennessee State Labor Commissioner Burns Phllips

Photo by Contributed Photo/Times Free Press.

With Tennessee's unemployment insurance fund recovering, the state is removing an extra 0.6 percent fee on employer premiums for jobless benefits.

The Tennessee Department of Labor and Workforce Development today announced most employers will pay less this quarter due to the improved fiscal health of the state fund for jobless benefits. As of June 30, Tennessee's Unemployment Compensation Trust Fund was more than $650 million, triggering the permanent expiration of the 0.6 percent additional fee in premium rates. Additionally, the trust fund trigger temporarily shifted the premium rate table from table three to five, further increasing potential savings for employers for the next two calendar quarters.

Legislation enacted in June 2009 created the temporary additional fee on all unemployment insurance premium rates to help replenish the state fund after rising joblessness drained most of the fund and forced the state to take a $20 million interest-free loan from the federal government to continue benefit payments. The state paid back the federal loan within a month, and the measure has steadily improved the health of the fund to its balance of $817.6 million as of Aug. 23.

"Tennessee has shown a tremendous amount of fiscal responsibility managing the fund into which employers contribute," Tennessee Labor Commissioner Burns Phillips said.

Employers were mailed notifications of the changes to their individual accounts at the end of August showing their revised premium rate for the third and fourth quarters of the current year.