Friday, August 20, 2010

UNEMPLOYMENT INSURANCE - WHAT HAPPENS IF EMPLOYER DOES NOT PAY TAXES

Most important to be aware of is Title 6 of the UI act in the Labor Law when an Employer does not pay taxes. Here are some pertinent provisions:

"Sec. 570. Payment of contributions.

1. Rate. Each employer liable under this article shall pay contributions on all wages paid by him at the rate of five and four-tenths per centum or, if applicable to the employer, at the rate provided by the provisions of sections five hundred seventy-seven and five hundred eighty-one. However, if contributions so established exceed five and four-tenths per centum of wages paid by him which are subject to the federal unemployment tax act, they shall be reduced by that part of such excess, if any, which is caused by the provisions of paragraph (b) of subdivision one of section five hundred eighteen.

Subd. I as amended by L. 1967, Ch. 280, effective April/ 18,1967; L. 1985, Ch. 7 effective March 19, 1985.

2. Time and method of payment. Contributions shall become payable by any employer for wages paid on and after the date on which he becomes liable under this article. All contributions from employers shall be paid at such times and in such manner as the commissioner may prescribe.

3. Default. An employer who fails to pay contributions required to be made by him to the fund shall pay interest at the rate of one per centum of the amount of such contributions for each month he is in default. Such interest shall be assessed, collected and paid as part of the payment required to be made by the employer to the fund.

Subd. 3 as renumbered and amended by L. 1953, Ch. 726 effective April/ 14, 1953; further amended by L.1981, Ch. 639 effective January 1, 1982.

4. Fraud. If any part of any deficiency is due to fraud with intent to avoid payment of contributions to the fund, fifty per centum of the total amount of the deficiency, in addition to such deficiency, shall be assessed, collected, and paid in the same manner as if it were a deficiency.

Subd. 4 as renumbered by L. 1953, Ch. 726, effective April 14, 1953."

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