UNEMPLOYMENT INSURANCE - HEARING & APPEAL

Although technically I could have also made an application to reopen under Section 463.6 of the Appeal Board rules, I chose to file a Notice of Appeal to the Appeals Board under Section 463.1. Here are the two statutes involved:

"Section 463.6 Reopening.

(a) On its own motion or on application duly made to it, the board, in its discretion, may reopen a decision.

(b) On its own motion or on application duly made to it, the board, pursuant to section 534 of the law, may modify or rescind its order, decision or determination. If an application for such reopening is not received by the board or postmarked within 30 days after such order, decision or determination, the application must contain an explanation for the delay. If good cause for the delay has not been established by the explanation, the board may, without further notice to the parties, deny the application by an order which shall be sent to all parties. If an application is not denied by an order of the board for this reason, notice of reopening or notice or receipt of the application to reopen shall be sent to all parties and their duly designated representatives. The notice shall advise the parties of their basic rights while the reopening is pending. The parties shall have the same rights as those set forth in sections 463.1 and 463.2 of this Part with regard to an appeal. The board may, in its discretion, schedule a hearing for argument or to receive further evidence. The board may adhere to, modify or rescind its prior decision or may deny the application to reopen.

(c) On its own motion or on application duly made to it, the board, pursuant to subdivision 3 of section 620 of the law, may modify or rescind an administrative law judge decision, where no appeal was duly taken. If an application for such a reopening is not received by the board or postmarked within 25 days after the administrative law judge decision, the application must contain an explanation for the delay. If good cause for the delay has not been established by the explanation, the board may hold a hearing, upon due notice to all parties, regarding the timeliness of the request for the board to reconsider the administrative law judge decision. The board may, without further notice to the parties, dismiss the appeal or deny the application by an order which shall be sent to all parties. If an application is not thus dismissed or denied, notice of reopening or notice of receipt of the application to reopen shall be sent to all parties and their duly designated representatives. The notice shall advise the parties of their basic rights while the reopening is pending. The parties shall have the same rights as those set forth in sections 463.1 and 463.2 of this Part with regard to an appeal. The board may, in its discretion, schedule a hearing for argument or to receive further evidence. The board may affirm, modify or reverse the administrative law judge decision or may deny the application to reopen.

(d) Whenever the board reopens a decision pursuant to this section, it shall state the reasons therefor in its decision.

Section 463.1 Notice of appeal.

(a) Generally. In any notice of appeal, the party appealing should state the reasons therefor.

(b) By claimant. A claimant may appeal, pursuant to section 621, subdivision 1 of the law, by filing a notice of appeal at the designated local office, or at any office of the administrative law judge section, or at the office of the appeal board, within 20 days after the mailing or personal delivery of the administrative law judge decision.

......................."

UNEMPLOYMENT INSURANCE - HEARING & APPEAL

Of course, the first thing one must do when in receipt of an adverse notice of decision is, after reading the decision, read the back for instructions regarding appeal, etc.

UNEMPLOYMENT INSURANCE - HEARING & APPEAL

This is how the case first came to me: a friend of the Claimant advised me that the Claimant was hopeless and was denied Unemployment Insurance and asked if I could help. I asked for a copy of the decision, which is reproduced here.

UNEMPLOYMENT INSURANCE - HEARING & APPEAL

Well every case starts with an employment and a termination. In this first case scenario: the Claimant was a home health aide - in the fall of 2008, a patient made a claim of physical abuse and a criminal complaint for endangering an incomptent person was filed. Claimant was immediately terminated.

UNEMPLOYMENT INSURANCE - HEARING & APPEAL

The next issue to be discussed will be from a case I am currently working on now on appeal.

UNEMPLOYMENT INSURANCE - WHAT HAPPENS IF EMPLOYER DOES NOT PAY TAXES

Here is a sample Notice of Audit under Section 575.

UNEMPLOYMENT INSURANCE - WHAT HAPPENS IF EMPLOYER DOES NOT PAY TAXES

There may be times that information regarding non-payment will be found during a DOL audit:

"Sec. 575. Maintenance, audit, and report of remuneration and employment records.

1.Requirements. Every employer shall keep a true and accurate record of each person employed by him, the name and social security account number, and the amount of remuneration paid to each, and such other records as are necessary under this article in the manner prescribed by regulations of the commissioner and shall furnish to the commissioner, upon demand, a sworn statement of the same. Such records, together with all other records reflecting or bearing upon them, shall be open to inspection at any time and as often as may be necessary to verify the number of employees, the periods of their employment, and the amount of their remuneration. Every employer shall report information from such records at such time and in such manner as the commissioner may by regulation prescribe. Any employer who shall violate any of the provisions of this section or who shall willfully falsify any record which he is required to maintain or who shall willfully file a false report shall be guilty of a misdemeanor."

Subd.1 as amended by L.1951, Ch. 645 effective June 4, 1951.

Subds. 2 and 3 repealed, L. 2003, Ch.413, effective August 26, 2003.

4. Collection and disposition of penalties. Any penalty pursuant to the provisions of this section shall be assessed, collected, and paid into the fund in the same manner as if it were a deficiency, in accordance with the provisions of this title.

Subd. 4 as renumbered by L. 1954, Ch. 639, effective April 12, 1954; formerly Subd. 5."

UNEMPLOYMENT INSURANCE - WHAT HAPPENS IF EMPLOYER DOES NOT PAY TAXES

This statute sets forth the action the DOL can take for non-payment of Unemployment Insurance taxes:

"Sec. 573 - Labor Law. Collection of contributions in case of default

1. Civil actions. If an employer shall default in any payments required to be made by him to the fund, after due notice, the amount due from him shall be collected by civil action against him brought in the name of the commissioner, and the same, when collected, shall be paid into the fund. Such employer's compliance with the provisions of this article requiring payments to be made to the fund shall date from the time of the payment of said money so collected.

Civil actions brought in the name of the commissioner under this section to collect contributions, interest, or penalties from an employer shall be entitled to preference, conferred by law to actions brought by any state officer as such, upon the calendar of all courts.

2. Warrants. In addition and as an alternative to any other remedy provided by this article and provided that no appeal or other proceeding for review provided by title eight of this article shall then be pending and the time for the taking thereof shall have expired, the commissioner may issue a warrant under his official seal, directed to the sheriff of any county, commanding him to levy upon and sell the real and personal property which may be found within his county of an employer who has defaulted in the payment of any sum determined to be due from such employer for the payment of such sum together with interest, penalties, and the cost of executing the warrant, and to return such warrant to the commissioner and to pay into the fund the money collected by virtue thereof within sixty days after the receipt of such warrant. The sheriff shall within five days after the receipt of the warrant file with the clerk of his county a copy thereof, and thereupon such clerk shall enter in the judgment docket the name of the employer mentioned in the warrant and the amount of the contribution, interest, and penalties for which the warrant is issued and the date when such copy is filed. Thereupon the amount of such warrant so docketed shall become a lien upon the title to and interest in real property and chattels real of the employer against whom the warrant is issued in the same manner as a judgment duly docketed in the office of such clerk. The sheriff shall then proceed upon the warrant in the same manner, and with like effect, as that provided by law in respect to executions issued against property upon judgments of a court of record, and for his services in executing the warrant he shall be entitled to the same fees, which he may collect in the same manner.

In the discretion of the commissioner a warrant of like terms, force, and effect may be issued and directed to any officer or employee of the department of labor who may file a copy of such warrant with the clerk of any county in the state, and thereupon each such clerk shall docket it and it shall become a lien in the same manner and with the same force and effect as herein before provided with respect to a warrant issued and directed to and filed by a sheriff; and in the execution thereof such officer or employee shall have all the powers conferred by law upon sheriffs, but he shall be entitled to no fee or compensation in excess of the actual expenses paid in the performance of such duty.

If a warrant is returned not satisfied in full, the commissioner shall have the same remedies to enforce the amount thereof as if the commissioner had recovered judgment for the same."

UNEMPLOYMENT INSURANCE - WHAT HAPPENS IF EMPLOYER DOES NOT PAY TAXES

Of course, an Employer must notify the DOL of their liability for taxes:

"Sec. 572. Notice of liability. Any employer who has become liable for contributions shall notify the commissioner of such fact immediately and shall give information concerning his operations and persons employed by him.

§572 as amended by L. 1953, Ch. 726, effective April 14, 1953."

UNEMPLOYMENT INSURANCE - WHAT HAPPENS IF EMPLOYER DOES NOT PAY TAXES

Next to consider is the following Labor Law statute:

Sec. 571. Assessment of contributions due.

If an employer fails to file a quarterly combined withholding, wage reporting and unemployment insurance return as required by paragraph four of subsection (a) of section six hundred seventy-four of the tax law for the purpose of determining the amount of contributions due or for the purpose of determining contribution rates under this article, or if such return when filed is incorrect or insufficient and the employer fails to file a corrected or sufficient return within thirty days after the commissioner requires the same by written notice, the commissioner shall determine the amount of contribution due from such employer and the amount of wages paid by such employer on the basis of such information as may be available and shall give written notice of such determination to the employer. Such determination shall finally and irrevocably fix the amount of contribution and the amount of wages paid for the purpose of computing contribution rates, unless the commissioner shall modify the amounts thereof, as provided under this article, subject, however, to the right to a hearing as hereinafter provided.

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."

UNEMPLOYMENT INSURANCE - WHAT HAPPENS IF EMPLOYER DOES NOT PAY TAXES

Here are more provisions of the Labor Law to be aware of in the case of an Employer's failure to pay UI taxes:

"Sec. 530. Industrial commissioner`s powers.

1. General powers. The commissioner shall administer this article and for such purpose he shall have power to make all rules and regulations and, subject to the regulations of the civil service, to appoint such officers and employees as may be necessary in the administration of this article.

Sec. 560. Terms of coverage.

1. Liability. Any employer shall become liable for contributions under this article if he has paid remuneration of three hundred dollars or more in any calendar quarter, except that liability with respect to persons employed in personal or domestic service in private homes shall be considered separately and an employer shall become liable for contributions with respect to such persons only if he has paid to them remuneration in cash of five hundred dollars or more in any calendar quarter. Such liability for contributions shall commence on the first day of such calendar quarter. An employer who, by operation of law, purchase or otherwise becomes successor to an employer liable for contributions shall become liable for contributions on the day of his succession. This provision shall not affect such successor`s liability as otherwise prescribed by law for unpaid contributions due from his predecessor.

Subd. 1 as amended by L. 1965, Ch. 103 effective January 1, 1966.

2. Hirings by helpers and assistants. Whenever any helper, assistant, or employee of an employer engages any other person in the work which said helper, assistant, or employee is doing for the employer, such employer shall for all purposes hereof be deemed the employer of such other person, whether such person is paid by the said helper, assistant, or employee, or by the employer, provided the employment has been with the knowledge, actual, constructive, or implied, of the employer.

3. Tax exemption in other laws. No exemption from taxation granted under any other law of the state shall be so construed as to apply to the payment of contributions under this article.

Former Subd. 3 repealed and former Subd. 5 renumbered to Subd. 3 by L. 1977, Ch. 675, effective January 1, 1978.

4. Federal instrumentalities. (a) In conformity with subsection (b) of section thirty-three hundred five of the federal unemployment tax act, any instrumentality of the United States, except such as are wholly or partially owned by the United States, or exempt from tax imposed by section thirty-three hundred one of said act by virtue of any provision of law, which specifically refers to such section, or the corresponding section of prior law, in granting such exemption, shall be subject to all the provisions of this article, except as provided in section fifty-two hundred forty of the revised statutes of the United States, as amended and modified by subsection (c) of section thirty-three hundred five of said act. If in any year this state shall not be certified under section thirty-three hundred four of said act, any contributions required under this article from any such instrumentality of the United States with respect to such year, including penalty and interest collected with respect thereto, if any, shall be refunded without interest.

Paragraph (a) as amended by L. 1961, Ch. 212, effective January 1, 1962.

(b) In conformity with subsection (c) of section thirty-three hundred five of the federal unemployment tax act, the commissioner is authorized to transmit a copy of any return or report of a national banking association relative to the association`s employees, their remuneration and services, to the comptroller of the currency and to request the said comptroller of the currency to cause an examination of the correctness of such return or report to be made at the time of the next succeeding examination of such association, and thereupon to transmit to the commissioner a complete statement of his findings respecting the accuracy of such returns or reports.

(c) This subdivision applies to national banking associations and any other federal instrumentalities which would be immune from contributions required under this article without authorization by subsection (b) of section thirty-three hundred five of the federal unemployment tax act.

Subd. 6 as amended by L. 1957, Ch. 712 effective April 19, 1957. Former Subd. 4 repealed and former Subd. 6 renumbered to Subd. 4 by L. 1977, Ch. 675 effective January 1, 1978.

5. Primary liability for contributions. Whenever one employer contracts with a second employer for any work which is part of the first employer`s usual trade, occupation, profession or enterprise, the first employer shall be liable for any contributions otherwise payable by the second employer, based upon wages paid in respect to such work, unless the second employer is free to do business with anyone who may wish to contract with him. Contributions so paid by the first employer on behalf of the second employer shall be deemed paid by the second employer. If the first employer fails to pay, on the date prescribed by the commissioner, contributions due on wages paid by the second employer, the commissioner may collect such deficiency from the second employer."

UNEMPLOYMENT INSURANCE - WHAT HAPPENS IF EMPLOYER DOES NOT PAY TAXES

In an investigation, we begin with Section 640 of the Labor Law (Article 18):

"Prosecution and litigation. The failure by any person to do any act required by or under the provisions of this article shall be deemed an act committed in part at the office of the industrial commissioner in Albany and committed in part in the place where the person resides or has a place for the regular transaction of business. The certificate of the industrial commissioner or deputy industrial commissioner to the effect that contribution has not been paid, that a report has not been filed, or that information has not been supplied, as required by or under the provisions of this article, shall be prima-facie evidence that such contribution has not been paid, that such report has not been filed, or that such information has not been supplied."

UNEMPLOYMENT INSURANCE - WHAT HAPPENS IF EMPLOYER DOES NOT PAY TAXES

If an Employer does not pay UI taxes, an inquiry will begin under Article 18 of the Labor Law and the Employer will receive a subpoena as noted here.

UNEMPLOYMENT INSURANCE - WHAT HAPPENS IF EMPLOYER DOES NOT PAY TAXES

For further information about the tax benefit loss to Employers for not paying UI taxes, this information is from the DOL website:

"Federal Unemployment Tax Act (FUTA)

You can take advantage of the FUTA (Federal Unemployment Tax Act) credit by paying your New York State Unemployment Insurance Tax in a timely manner. You can obtain a 5.4% credit against your annual Federal Unemployment Tax, using Form 940 or 940EZ, if you pay your state tax for the year by the 31st of the January following the close of the taxable year. This is the date the FUTA return is due. If you pay the state tax after January 31, the credit will be limited to 90% of the amount you could have received if you had paid on time.

If you do not pay the state tax, you cannot take credit against your federal tax, and you will be required to pay the full FUTA tax of 6.2%. Employers often assume that once they pay the FUTA tax at 6.2% they don't have to pay the State tax. However, this is not true. The state tax must also be paid. If your payments are late, the IRS will require you to obtain a Proof of Credit, form 940C, from the state to show that your state taxes have been paid. At that time you may apply to the IRS for your FUTA credit. For additional information regarding Proof of Credit, please call the Employer Account Adjustment Section."

UNEMPLOYMENT INSURANCE - WHAT HAPPENS IF EMPLOYER DOES NOT PAY TAXES

And here is an article on the issue from ehow.com which also mentions a federal tax benefit to Employer's who file timely their Unemployment Insurance Taxes:

"Unemployment Insurance Tax Laws in the State of New York
By Rhonda Campbell, eHow Contributing Writer

New York UnemploymentReuters reported that as of March 2010, New York State's unemployment rate was at 8.6 percent, down from the previous month's 8.8 percent unemployment rate. Employer unemployment insurance contributions help to fund temporary monies available to displaced workers. New York's Department of Labor provides oversight for the state's unemployment insurance laws. Understanding the laws can help employers and employees to get the aid that they need during times of economic downturn and work shortages.

Employers Required to Pay Unemployment Insurance

Employers who pay at least one employee $300 or more in a calendar quarter are required to pay unemployment insurance tax. Employers who hire domestic workers must pay the insurance if the domestic worker earns $500 or more in one or more calendar quarters. The insurance is not allowed to be deducted from employee wages. Employers who formerly paid unemployment insurance but who have not paid or employed a worker for four calendar quarters do not have to continue to pay the insurance. Employers are required to register with the Department of Labor to make their quarterly unemployment insurance payments, which are based upon the number of employees the employer hires and the gross wages for hired employees.

State Unemployment Tax Dumping

State unemployment tax dumping, or the attempt to transfer 10 percent or more of an employer's employees onto another employer in order to reduce unemployment insurance payments, is prohibited. Penalties for unemployment insurance tax dumping include a fine equal to 10 percent of the employer's taxable wages in the previous payroll year or a fine of $10,000, whichever sum is greater.

Lowered Federal Tax through State Unemployment Taxes

Employers can receive a 5.4 percent credit against their federal unemployment insurance tax if they submit their New York State unemployment insurance payments on time. Should an employer be late or negligent in paying their state unemployment insurance payments, they will be liable for the full 6.2 percent of their Federal Unemployment Tax Act (FUTA) tax. They must also still pay the state tax.

Penalties

Willful negligence to pay unemployment insurance tax is deemed to be a misdemeanor in New York State. Employers who refuse to allow Department of Labor commissioners to review their records will also be cited with a misdemeanor. It is also unlawful for employees or staff members at the Department of Labor to receive money for assistance that they give to employers or displaced workers regarding unemployment insurance.

References
•New York Department of Labor
•Reuters - New York Unemployment Rate"

UNEMPLOYMENT INSURANCE - WHAT HAPPENS IF EMPLOYER DOES NOT PAY TAXES

There are several methods to report Employer Tax Fraud and while the failure to pay UI taxes in and of itself may not tax fraud the DOL recognizes the following examples for reporting employer fraud activities:

•"off the books" or "under the table" wages

•SUTA Dumping - engaging in tax rate manipulation schemes. SUTA Dumping occurs when employers and/or their representatives manipulate the UI system by developing schemes to shift workforce payroll to other entities for the purpose of obtaining lower tax rates.

Information about employers committing fraud and you may anonymously and confidentially report UI Employer Tax Fraud activities by:

•contacting our 24-hour toll free Hotline at 1-866-435-1499
•contacting our UI Fraud Unit at (518) 485-2144 from 8:00 a.m. to 4:00 p.m.
•faxing a complaint form to (518) 485-6172
•mailing a complaint form to: New York State Department of Labor
Unemployment Insurance Division
W.A. Harriman Campus
Building #12
Liability & Determination Fraud Unit, Room 356
Albany, NY 12240-0322


Those who commit fraud are subject to fines, penalties, and/or criminal prosecution."

UNEMPLOYMENT INSURANCE - WHAT HAPPENS IF EMPLOYER DOES NOT PAY TAXES

The Unemployment Insurance Law also provides for some penalties:

"Sec. 630. Penalties. Any misdemeanor defined in this title shall be punishable by a fine of not more than five hundred dollars or imprisonment for not more than one year, or both. The penalties and misdemeanors imposed by this title are in addition to those otherwise prescribed in this entire article.

Sec. 631. Corporation officers` liability. If a corporation is convicted of any violation under this title, the president, secretary, treasurer, or officers exercising corresponding functions shall each be guilty of a misdemeanor.

Sec. 632. False statements or representations.

1. Benefits and contributions. Any person shall be guilty of a misdemeanor who wilfully makes a false statement or representation
........

(b) in order to reduce the amount of contributions to the fund.

2. Saleprice of commodities. Any person who, in connection with the sale or offer for sale of any commodity or service, or for the purpose of making such sale, makes any statement, written or oral, ascribing a particular part of the price of such commodity or service to a contribution imposed under this article knowing that such statement is false or that the contribution is not so great as the portion of such price ascribed to such contribution, shall be guilty of a misdemeanor.

Sec. 633. Wilful failure to pay contributions.Any person who wilfully refuses or fails to pay a contribution to the fund shall be guilty of a misdemeanor.

Sec. 634. Refusal to permit inspections of records. Any person who refuses to allow the commissioner or his authorized representative to inspect his payroll or other records or documents relative to the enforcement of this article shall be guilty of a misdemeanor.

Sec. 635. Deductions from wages. Any employer who shall make a deduction from the remuneration of any employee to pay any portion of the contribution which the employer is required to make shall be guilty of a misdemeanor."

UNEMPLOYMENT INSURANCE - WHAT HAPPENS IF EMPLOYER DOES NOT PAY TAXES

Now we should look at some statutes in the Unemployment Insurance Law:

"Sec. 573 (LABOR LAW). Collection of contributions in case of default

1. Civil actions. If an employer shall default in any payments required to be made by him to the fund, after due notice, the amount due from him shall be collected by civil action against him brought in the name of the commissioner, and the same, when collected, shall be paid into the fund. Such employer's compliance with the provisions of this article requiring payments to be made to the fund shall date from the time of the payment of said money so collected.

Civil actions brought in the name of the commissioner under this section to collect contributions, interest, or penalties from an employer shall be entitled to preference, conferred by law to actions brought by any state officer as such, upon the calendar of all courts.

2. Warrants. In addition and as an alternative to any other remedy provided by this article and provided that no appeal or other proceeding for review provided by title eight of this article shall then be pending and the time for the taking thereof shall have expired, the commissioner may issue a warrant under his official seal, directed to the sheriff of any county, commanding him to levy upon and sell the real and personal property which may be found within his county of an employer who has defaulted in the payment of any sum determined to be due from such employer for the payment of such sum together with interest, penalties, and the cost of executing the warrant, and to return such warrant to the commissioner and to pay into the fund the money collected by virtue thereof within sixty days after the receipt of such warrant. The sheriff shall within five days after the receipt of the warrant file with the clerk of his county a copy thereof, and thereupon such clerk shall enter in the judgment docket the name of the employer mentioned in the warrant and the amount of the contribution, interest, and penalties for which the warrant is issued and the date when such copy is filed. Thereupon the amount of such warrant so docketed shall become a lien upon the title to and interest in real property and chattels real of the employer against whom the warrant is issued in the same manner as a judgment duly docketed in the office of such clerk. The sheriff shall then proceed upon the warrant in the same manner, and with like effect, as that provided by law in respect to executions issued against property upon judgments of a court of record, and for his services in executing the warrant he shall be entitled to the same fees, which he may collect in the same manner.

In the discretion of the commissioner a warrant of like terms, force, and effect may be issued and directed to any officer or employee of the department of labor who may file a copy of such warrant with the clerk of any county in the state, and thereupon each such clerk shall docket it and it shall become a lien in the same manner and with the same force and effect as herein before provided with respect to a warrant issued and directed to and filed by a sheriff; and in the execution thereof such officer or employee shall have all the powers conferred by law upon sheriffs, but he shall be entitled to no fee or compensation in excess of the actual expenses paid in the performance of such duty.

If a warrant is returned not satisfied in full, the commissioner shall have the same remedies to enforce the amount thereof as if the commissioner had recovered judgment for the same."

UNEMPLOYMENT INSURANCE - WHAT HAPPENS IF EMPLOYER DOES NOT PAY TAXES

Of course the DOL has some answers on what happens. As their website explains (note that the links do not work but the page, containing the links is as follows (http://www.labor.ny.gov/ui/dande/penalties2.shtm)):

"Failure to file or late filing of the NYS-45, including the NYS-45-ATT

When an employer fails to file all required parts of the Quarterly Combined Withholding, Wage Reporting and Unemployment Insurance Return, form NYS-45 (including NYS-45-ATT, when applicable), or files the return late, penalties authorized under the Tax Law and the Unemployment Insurance Law are assessed. The amount of the penalty depends on how late the return was filed and the employer’s past reporting history.

If all required parts of the Quarterly Combined Withholding, Wage Reporting and Unemployment Insurance Return are not received by the due date, the return is considered delinquent. Approximately 50 days after the due date, a certified notice of failure to file is sent to notify employers of the delinquency and of the estimated penalty assessment. This notice also provides information about the employer’s right to file a protest.

When all required parts of the return are filed, the employer is notified of the actual penalty assessment and given information about filing a protest.

FAILURE TO FILE PENALTY

If the return is not received by the due date the penalty is the GREATER of:

•$1,000, OR
•$50 times the number of employees shown on the last quarterly return filed by the employer (estimated if no reports were filed). The maximum penalty for any calendar quarter is $10,000.

Penalty cancelled: This penalty will automatically be abated if all parts of the return are filed prior to or within 30 days of the certified notice of failure to file AND there were no late filings in the prior four quarters.

Penalty adjusted: This penalty will be recalculated based on actual figures and a penalty will be assessed for late filing when all required parts of the NYS-45 (and NYS-45-ATT, when applicable) are received.

To protest a penalty imposed against your account for failure to timely file your Quarterly Combined Withholding, Wage Reporting and Unemployment Insurance Return, Form NYS-45, click here.

PENALTIES FOR LATE FILING

1. Returns received prior to or within 30 days of the certified notice and employer has prior delinquency. When all parts of the return are received prior to the mailing of the certified notice of failure to file, or within 30 days of that notice, AND the employer was delinquent in one or more of the prior four quarters, the penalty will be the LESSER of:

•$50 times the number of employees shown on the late return, but not less than $1,000 or more than $10,000, OR
•the sum of 5% of the withholding tax shown on the return, if the return is not more than one month late and 5% for each additional month the return is late up to 25% (if the return is more than 60 days late, this amount cannot be less than the lesser of $100 or 100% of the tax required to be shown but not paid by the due date) AND
•5% of the UI contributions shown on the return, if the return is not more than one month late, and an additional 5% for each additional month the return is late up to 25%, but not less than $100.

2. Returns received more than 30 days after notification. When all required parts of the return are received more than 30 days after the mailing of the certified notice, the penalty is adjusted to the GREATER of:

•$50 times the number of employees shown on the late return, but not less than $1,000 or more than $10,000, OR
•the sum of 5% of the withholding tax shown on the return, if the return is not more than one month late and 5% for each additional month the return is late up to 25% (if the return is more than 60 days late, this amount cannot be less than the lesser of $100 or 100% of the tax required to be shown but not paid by the due date) AND
•5% of the UI contributions shown on the return, if the return is not more than one month late, and an additional 5% for each additional month the return is late up to 25%, but not less than $100.
3. Returns obtained by audit. If the employer does not file all required parts of the return and either the Tax Department or the Department of Labor, or both, review the employer’s records and obtain the required reports, a maximum penalty may be assessed. It is calculated as follows:

•$50 times the number of employees shown on the return, but not less than $1,000 or more than $10,000 AND
•the sum of 5% of the withholding tax shown on the return, if the return is not more than one month late and 5% for each additional month the return is late up to 25% (if the return is more than 60 days late, this amount cannot be less than the lesser of $100 or 100% of the tax required to be shown but not paid by the due date) AND
•5% of the UI contributions shown on the return, if the return is not more than one month late, and an additional 5% for each additional month the return is late up to 25%, but not less than $100.

CANCELLATION OF PENALTIES

A penalty may be cancelled if the employer has since filed all required parts of the return AND can show reasonable cause for not filing a return by the due date. Penalty assessment notices explain how to file a protest."