New Massachusetts Law Extends Unemployment Benefits and Prevents Increased Taxes on Employers Figure

June 5, 2020  |  COVID-19; Employment & Employee Benefits; Insights

New Massachusetts Law Extends Unemployment Benefits and Prevents Increased Taxes on Employers

By:

Governor Baker has recently signed into law Bill S.2618. This new law was passed in response to the unprecedented numbers of unemployment benefits claims seen in Massachusetts as a result of the COVD-19 (coronavirus) pandemic.

The new law provides some new relief for employers. Unemployment insurance in Massachusetts is funded by quarterly taxes paid by employers. The amount of these quarterly payments is based on each employer?s ?experience rating.? Employee claims for unemployment benefits negatively impact an employer?s employment rating. Many businesses were forced to shutter due to the Governor?s emergency declaration and many more employees were laid off as a result of the pandemic. The result has been over 15% unemployment in Massachusetts and many hundreds of thousands of individuals filing for unemployment benefits. All of these unemployment benefits claims could have overwhelmed employers, however, the new law states that benefits paid to employees will ?not be charged to the account of any employer nor included in the calculation of an employer?s experience rate? if the employee was ?separated from employment? as a result of the coronavirus pandemic or the Governor?s declaration of emergency. This change will save employers a significant amount in taxes in 2021.

Individuals saw additional relief in this new law as well. Specifically, the law extends unemployment benefits from 26 to 30 weeks when unemployment claims in any week during the benefit year exceed 100,000. It also eliminates the current cap on dependents? benefits.

Finally, the new law grants nonprofit employers a 120-day grace period before the next scheduled payment is due to the unemployment fund. It is anticipated that the legislature will use this time to assess whether or not to grant additional relief to nonprofits who are being hit particularly hard by the coronavirus pandemic.

Disclaimer: This summary is provided for educational and informational purposes only and is not legal advice. Any specific questions about these topics should be directed to attorneys Nathaniel Donoghue or J. Allen Holland.

About Rich May. P.C.

Rich May, P.C., a law firm founded in 1937 and located in the heart of Boston’s financial district, concentrates its practice on corporate, financial, civil litigation, energy, real estate, entertainment and wealth planning matters. The firm’s clients include a broad group of businesses in New England and throughout the country. Rich May provides the breadth and depth of expertise generally associated with large, national firms, while maintaining the prompt, personal service found in smaller, regional firms. Rich May’s clients have direct access to experienced attorneys who are familiar with both the client and the area of inquiry and can provide timely and practical legal solutions.

Rich May has been elected and admitted as a member of Ally Law. This membership, which provides affiliations with more than 2,800 lawyers at over 70 firms in 50 countries, supplements our ability to assist clients throughout North America and around the world.