CT Unemployment Benefits to Rise $18 a Week on Oct. 2

On Monday, September 26th the Connecticut Department of Labor issued a press release that announced Unemployment Insurance benefits maximum will rise from $555 a week to $573. This increase will go into effect Sunday, October 2nd.

This means anyone applying for new unemployment benefits on or after Oct. 2, 2011 will receive the revised rate. New claims filed before this date, as well as those currently collecting unemployment benefits, will not receive the revised rate. Also unchanged is the weekly dependent allowance, it remains at $15 per dependent with a $75 maximum.

An increase in unemployment benefits is limited, by law, to $18 a week or 60 percent of the average wage - whichever is less. This revision was based on average manufacturing wages from the year ending June 30, 2011. These earnings averaged $995.88 a week in 2010-2011, up about 3.9% from the 2009-2010 average of $958.52.

Previously, unemployed workers in Connecticut would receive 26 weeks of unemployment insurance benefits, but Congress approved an extension of up to 99 weeks in states with high unemployment rates. In August the Connecticut unemployment rate was 9 percent. The year ending on August 31, 2011 saw unemployment benefits average $301 a week with claimants receiving benefits for an average of 19.6 weeks. This is a slight increase from last year's averages of $297 a week for 18.6 weeks.

According to the press release:
"Regular state unemployment benefits are funded by a separate assessment paid by 98,300 Connecticut employers. The tax is based on the first $15,000 of each worker's annual wages."

After reviewing the press release, especially the above paragraph, we do not believe that this $18 increase will affect how much our clients are paying into the unemployment benefits fund. We'll keep monitoring this situation and alert our clients to any changes.

Further Reading:
CT DOL Press Release 9/26/11 (opens as .PDF)

Special Assessment for Connecticut Unemployment Insurance

We've received a few inquiries this month about the Special Assesment for 2011, which occurred in August. While payment was due on August 31, we at NPD want to better inform our clients and other business owners in Connecticut about what they paid into.

The Connecticut Unemployment Trust Fund became insolvent on October 13, 2009. In layman's terms this means the fund is no longer able to pay out to the state's unemployed. The reason behind the fund's insolvency is an increase in workers filing for unemployment insurance benefits. There were about 40,000 filings in 2007, which has since grown to 130,000. The trend continued this year, and unemployment insurance payouts will greatly exceed tax revenue.


Paying out unemployment benefits is a legal requirement for the state of Connecticut and to keep in compliance with the law the state is borrowing funds from the U.S. Department of Labor. Connecticut has borrowed about $810 million and it is projected that in the next 2 to 3 years that number could reach $1 billion.

This loan is structured in a different manner than most federal loans. The American Recovery and Reinvestment Act of 2009 includes a provision that waives interest on unemployment insurance loans through 2010. However, interest will need to be paid in 2011 and moving forward (as well as repayment of the outstanding balance).

State law allows for annual Special Assessments to be collected from employers to make interest payments. This law excludes entities that reimburse the state for unemployment costs to former employees dollar-for-dollar.

Employers are already aware that the assessment was sent out on August 1st with a payment date of August 31st. The total for the 2011 Special Assessment is around $30 million. The average amount due from each employer varied based on amounts borrowed and total active employees as of August 2011.

Connecticut is one of 33 states to borrow money from the federal government for unemployment insurance payments, the total amount borrowed will near $4 billion  in the next two years. Additionally, states with outstanding loans for two consecutive years must make additional payments into the Federal Unemployment Tax Act system. The FUTA rate for 2011, due January 2012, will increase from 0.8% to 1.1%. Paying into FUTA pays down the loan principal, and the increase in tax rate is approximately $21 an employee. These payments will be applied to the loan balance, reducing the loan principal.

We hope this explanation was useful to you, as it affects all businesses in the state of Connecticut. If you have any other questions regarding the Special Assessment or the FUTA tax rate increase please contact NPD Payroll and we'll gladly help out.

Further Reading:
CT Dept. of Labor "Special Assessment At-A-Glance"

New Client Spotlight Video: Playhouse on Park

Last Thursday our cameraman was invited to the Playhouse on Park in West Hartford to film our second client spotlight video. Co-founders Tracy, Sean, and Darlene were gracious enough to sit down for an interview and let our cameraman into a closed-set dress rehearsal for their latest play, Around the World in 80 Days.

Over their first two seasons the Playhouse on Park has consistently put together a plethora of entertainment, from plays to musicals, comedy nights, cabarets, childrens theatre, and more. Their hybrid casting model affords local actors the opportunity to share the stage with a variety of professional performers, including Broadway actors. Working together with local restaurants, businesses, and schools their goal is to bring the community together over great theatrical productions.

I have personally attended their performances, as have other employees of NPD Payroll, and I can tell you first-hand that the Playhouse Theatre Group does a fantastic job. Their diverse selection of performances and training courses afford opportunities for both entertainment and education to children and adults alike. If you're local to the area I recommend that you take the time to check them out.

NPD Payroll provides a service to the Playhouse on Park, but it's more than a business relationship. We are supporters of local theatre and are happy that we can help the Playhouse with their day-to-day operations.

Thanks again to Tracy, Sean, and Darelene and please visit the Playhouse on Park website for more information. Around the World in 80 Days opens tomorrow, Saturday Sept. 17th for a six-performance engagement.

NPD Celebrates National Payroll Week!

The NPD office has been buzzing with excitement the past few days because of National Payroll Week. This celebration is sort of like our Christmas, as it highlights not only the hard work of payroll professionals but also the American worker. There are over 156 million employed Americans and we proudly help a portion of them access their wages.

American payroll professionals collect and report 71.9% of all federal revenues ($1.7 trillion annually), and it is our task to process wages, report earnings, and withhold employment taxes. NPD is staffed with highly skilled professionals who are required know all local, state and federal tax rules and regulations. Have you ever wondered what percentage of your salary should be deducted for FICA, SS, MED, and 401(k), much less what these abbreviations mean? Where does your money go between "gross pay" and "net pay"? Is the right amount of federal and state income tax being deducted? These are all questions that we have to answer on a daily basis at NPD Payroll.

National Payroll Week is also an opportunity for the uninitiated to become informed about how payroll works. I'd encourage you to check out the National Payroll Week website to find out more about this yearly celebration and learn more about your paycheck. While you're there be sure to take the "Getting Paid in America" survey for a chance to win a trip to Las Vegas.

Also in celebration of National Payroll Week, NPD is offering a special for new clients:

Become a Client of NPD Payroll Before December and get FREE End-of-Year Processing!

Become a Client of NPD Payroll After January and receive 2 Months of FREE Payroll!

For more information about National Payroll Week, to talk about your paycheck, or to become a client please contact us at (860) 284 0152 or send an email to fzeller@npdpay.com or sbanever@npdpay.com

Beyond the Paycheck: The Story of Mark Kelly

Writing a weekly blog is sometimes a challenging task. Staying current and topical often means a lot of searching for online resources regarding payroll and HR. During my usual Google News search for "payroll" I came across an article that stuck out among the rest. While it only mentions payroll a few times, I thought this was a touching story that more people should be aware of. This is the story of Mark Kelly and his battle with ALS.

Mark has been a police officer in Mesa, Arizona for six years. For over two of those years he has been dealing with the symptoms of amyotrophic lateral sclerosis; commonly known as ALS or Lou Gehrig's disease. Normally this would mean that an officer in Mark's situation would have to take a medical retirement. But being on the force only six years would mean that Mark, his wife Elizabeth, and their five children would have to live on about $600 a month provided in the retirement package. Since July of 2010 Mark has been unable to work, confined to a wheelchair as he perseveres in the face of an uncurable disease. A medical retirement seemed inevitable.

However, if Mark were to die as an officer his family would be provided full retirement benefits, about four times the amount of a medical retirement. The Mesa Police Association rallied around one of their own and donated their unused vacation time to keep Mark on the payroll. Hearing of his situation, firefighters and other Mesa city employees began donating their vacation time. Over the past year thousands of hours have been donated to Mark, enough to keep him on payroll for the time being.

In February Mark was down to 200 hours of donated time, leaving him five weeks away from a forced retirement. Using an eye-tracking computer he typed a plea out to his Facebook friends, one letter at a time:

"Medical bills and living with ALS have depleted our funds to the point we are living paycheck to paycheck... The only life insurance I have is through the city. So in order to help my family I need to die working for the city, which is sad."

The response to his heartbreaking message was overwhelming; nearly 270 city employees donated more than 2,737 hours to Mark. Enough to keep him on the payroll for the next year. Unfortunately, Mark's time with his family can't be measured in years. Mark is now completely paralyzed, has a machine forcing air into his lungs, and is on a feeding tube because he can no longer eat. Mark's time is almost up.

The community response to Mark's situation tells me that there are still good people left in the world. Let this story serve as a reminder that your co-workers may be going through difficult times, and that when they ask for help you should be there to heed the call. Friends, family, co-workers, and even complete strangers came to the aid of Mark Kelly and his family; consider doing the same and reaching out for a cause that you feel strongly about.